APICS CPIM Online Practice Questions and Exam Preparation

APICS CPIM Online Questions & Answers

• Question 101:

  What is the reason for using the sample inspection?

  A. testing the product is destructive
  B. there is not enough time to give 100% inspection to a batch of product
  C. human error is estimated to be as high as 20% when performing long-term repetitive testing
  D. All of the above
  D. All of the above

• Question 102:

  The product structure file: A. Contains a list of single-level components and quantities needed to assemble

  B. Forms a basis fro a parent pick list.
  C. Both of these
  D. None of these
  C. Both of these

• Question 103:

  Which of the following statements best characterizes enterprise resources planning (ERP) systems?

  A. They track activity from customer order through payment.
  B. They are expensive but easy to implement.
  C. They provide real-time planning and scheduling, decision support, available-to-promise (ATP), and capable-to-promise (CTP) capabilities.
  D. They are used for strategic reporting requirements.
  C. They provide real-time planning and scheduling, decision support, available-to-promise (ATP), and capable-to-promise (CTP) capabilities.

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  Explanation/Reference:

  Enterprise resource planning (ERP) systems are software platforms that help organizations manage and integrate the essential parts of their businesses, such as finance, supply chain, operations, human resources, and more. ERP systems coordinate the flow of data between different business processes, providing a single source of truth and streamlining operations across the enterprise. ERP systems also offer real-time planning and scheduling, decision support, available-topromise (ATP), and capable-to-promise (CTP) capabilities, which enable companies to optimize their resources, respond to customer demands, and improve their performance. This aligns with CPIM's focus on aligning the supply chain to support the business strategy and conducting sales and operations planning (SandOP) to support strategy. References: The concepts are covered indetail in Module 1: Business Planning and Strategy (1 and Module 2: Demand Management

  (2. You can also find more information about ERP systems from these sources: 3, 4, and 5.

• Question 104:

  Which of the following actions will result In lower inventory levels?

  A. Level load the master production schedule (MPS).
  B. Reduce replenishment lead times.
  C. Increase customer service level.
  D. Decentralize inventory locations.
  B. Reduce replenishment lead times.

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  Explanation/Reference:

  Reducing replenishment lead times will result in lower inventory levels because it means that the time between placing an order and receiving the goods is shorter. This reduces the need to hold excess inventory to cover the uncertainty and variability of demand and supply. Reducing replenishment lead times can also improve customer service levels, as orders can be fulfilled faster and more reliably. Level loading the master production schedule (MPS), increasing customer service level, and decentralizing inventory locations are all actions that will increase inventory levels, as they require more inventory to buffer against fluctuations in demand and supply, and to ensure availability at multiple locations. References: Inventory Management: Lead Time Reduction, APICS CPIM 8 Planning and Inventory Management | ASCM

• Question 105:

  An example of a cradle-to-cradle sustainability model would be:

  A. a laundry service collects dirty baby clothes from families; cleans the clothes in large, efficient batches; and then sorts and delivers the clothes back to each family.
  B. a coffee shop collects paper waste in its restaurants, has a selected supplier collect the paper waste to be recycled, and then purchases paper products from that supplier.
  C. a company uses wood that has been gathered from multiple sources to construct items, such as beds and toys for babies and young children.
  D. a bank offers the lowest interest rates on loans to firms that are committed to using recycled materials and implementing zero-waste initiatives in their processes.
  B. a coffee shop collects paper waste in its restaurants, has a selected supplier collect the paper waste to be recycled, and then purchases paper products from that supplier.

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  Explanation/Reference:

  A cradle-to-cradle sustainability model is a design concept that aims to create products that can be reused or recycled indefinitely, without generating any waste or pollution. It mimics the natural cycles of nature, where everything is a nutrient for something else. A cradle-to-cradle model differs from a cradle-to-grave model, which follows a linear path of production, consumption, and disposal.

  Option B is an example of a cradle-to-cradle model, because the paper waste from the coffee shop is collected and recycled by a supplier, who then provides new paper products to the coffee shop. This creates a closed loop of material flow, where nothing is wasted and the paper is continuously reused.

  Option A is not a cradle-to-cradle model, because the laundry service does not reuse or recycle the baby clothes. It only cleans and delivers them, but does not prevent them from eventually ending up in the landfill.

  Option C is not a cradle-to-cradle model, because the company does not ensure that the wood it uses is from sustainable sources, or that the products it makes can be easily disassembled and recycled. It also does not consider the environmental impacts of transporting the wood from different locations.

  Option D is not a cradle-to-cradle model, because the bank does not directly influence the design or production of the products that the firms use. It only provides financial incentives for them to adopt more sustainable practices, but does not guarantee that they will follow a cradle-to-cradle approach.

• Question 106:

  A part is sold as a service part, and It is also used as a component In another part. Which of the following statements about the planning for this part is true?

  A. Its low-level code is zero.
  B. The material requirements for the part will be understated.
  C. The service part demand can be included In the gross requirements.
  D. It shouldn't have any safety stock.
  C. The service part demand can be included In the gross requirements.

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  Explanation/Reference:

  The service part demand can be included in the gross requirements for the part. Gross requirements are the total demand for an item derived from all sources, such as customer orders, dependent demand, forecast, or safety stock. Service part demand is the demand for an item that is used to replace or repair a product after it has been sold to the customer. Service part demand is independent of the production of other items, and it can be forecasted based on historical data, warranty information, or customer contracts. Service part demand can be added to the gross requirements for the part, along with the dependent demand from the other part that uses it as a component.

  Option A is not correct, because the low-level code of the part is not zero. Low-level code is the lowest level in the bill of material (BOM) at which an item appears as a component. An item that is not a component of any other item has a low-level code of zero. An item that is a component of another item has a low-level code equal to one plus the low-level code of the parent item. In this case, the part is a component of another part, so its low-level code is at least one.

  Option B is not correct, because the material requirements for the part will not be understated. Material requirements are the net requirements for an item after deducting the available inventory and scheduled receipts from the gross requirements. If the service part demand is included in the gross requirements, the material requirements will reflect the true demand for the part. If the service part demand is not included, the material requirements will be understated, and the part may face stockouts or backorders.

  Option D is not correct, because the part should have some safety stock. Safety stock is the extra inventory held to protect against uncertainties in demand, supply, or lead time. Safety stock can help reduce the risk of stockouts, improve customer service, and buffer against variability. The part should have some safety stock to account for the fluctuations in the service part demand, which may depend on factors such as product failure rate, customer behavior, or environmental conditions.

• Question 107:

  Which of the following prioritization rules will have the greatest impact In reducing the number of orders In queue?

  A. Critical ratio
  B. Shortest processing time
  C. Fewest operations remaining
  D. First come, first served
  B. Shortest processing time

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  Explanation/Reference:

  The shortest processing time rule is a prioritization rule that assigns the highest priority to the job that requires the least amount of processing time. This rule minimizes the average flow time of jobs and reduces the number of jobs in queue. The critical ratio rule assigns priority based on the ratio of time remaining until the due date to the remaining processing time. The fewest operations remaining rule assigns priority based on the number of remaining operations for each job. The first come, first served rule assigns priority based on the arrival time of the jobs. References: Managing Supply Chain Operations, Chapter 9: Scheduling and Sequencing, page 237. Manufacturing Planning and Control for Supply Chain Management: The CPIM Reference, Second Edition, Chapter 13: Scheduling and Execution, page 419.

• Question 108:

  A plant uses a level production strategy due to the high costs of hiring and letting go of skilled employees. The constrained resource is due to be upgraded in the fourth month of the planning horizon, and that will reduce capacity for that month by 17%.

  Which of the following actions would be appropriate in this situation to maintain current levels of customer service and gross margin?

  A. Increase planned production for the next three periods.
  B. Defer the upgrade to a period beyond the planning time fence.
  C. Increase planned production from the fifth period on.
  D. Defer the upgrade to the period in which the highest stock level is planned.
  A. Increase planned production for the next three periods.

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  Explanation/Reference:

  A level production strategy is a manufacturing strategy where a company produces a fixed number of products at a fixed rate1. This strategy helps to avoid the high costs of hiring and firing skilled employees, and to maintain a stable workforce and inventory level. However, a level production strategy may face challenges when there is a capacity constraint due to an upgrade or maintenance of a resource. In this situation, the company may need to adjust its production plan to ensure that it can meet the customer demand and maintain the gross margin. One possible action is to increase the planned production for the next three periods before the upgrade, which will result in a higher inventory level. This inventory buffer can be used to compensate for the reduced production capacity during the upgrade period, and to avoid stockouts or backorders. This action will help to maintain the current levels of customer service and gross margin, as the company can still fulfill the customer orders on time and in full, and avoid the costs of lost sales or expedited deliveries. Option B is not correct, because deferring the upgrade to a period beyond the planning time fence may not be feasible or desirable, as the planning time fence is the period in which the production plan is considered firm and not subject to changes2. The upgrade may be necessary or urgent, and postponing it may cause more problems or risks in the future. Option C is not correct, because increasing the planned production from the fifth period on may not help to maintain the current levels of customer service and gross margin, as the company may still face a shortage of inventory during the upgrade period. Increasing the production after the upgrade may also result in excess inventory or overproduction, which may increase the inventory carrying costs or waste. Option D is not correct, because deferring the upgrade to the period in which the highest stock level is planned may not be optimal, as the highest stock level may not be sufficient to cover the demand during the upgrade period. Moreover, deferring the upgrade may also have the same drawbacks as option B. References: 1 Guide to Level Production Strategy - Welp Magazine 3 2 Planning Time Fence | SAP Help Portal 4

• Question 109:

  What attempts to prevent the production of defects by showing that when the standard deviation increases there is an assignable cause for variation?

  A. Process capability
  B. Process variation
  C. Process control
  D. Process value
  C. Process control

• Question 110:

  Which of the following factors is used to determine safety stock?

  A. Number of customers
  B. Available capacity
  C. Forecast error distribution
  D. Time between customer orders
  C. Forecast error distribution

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  Explanation/Reference:

  Safety stock is the extra inventory that a company keeps to prevent stockouts or shortages due to uncertainties in demand, supply, or lead time. Safety stock acts as a buffer to protect the company from losing sales or disrupting operations. One of the factors that is used to determine safety stock is the forecast error distribution, which is the measure of how much the actual demand deviates from the forecasted demand. Forecast error distribution can be calculated by using statistical methods, such as standard deviation or mean absolute deviation, to find the average and the variability of the forecast errors. The higher the forecast error distribution, the more safety stock is needed to cover the potential demand fluctuations. Forecast error distribution is one of the components of the safety stock formula, which is:

  Safety stock = Z x LT x D

  Where:

  Z refers to the service level factor, which is the desired probability of not having a stockout.

  LT refers to the standard deviation of lead time, which is the average variability of the time it takes to replenish inventory.

  D is the average demand per unit of time.

  References := CPIM Part 2 Exam Content Manual, Version 8.0, ASCM, 2021, p. 24. CPIM Part 2 Learning System, Version 8.0, Module 2, Section C, Topic 3. How To Calculate Safety Stock (With Examples and FAQs). What is Safety Stock? (Definition, Formulas, Best Practices).