APICS New 2024 CPIM-8.0 Test Tutorial (Updated 152 Questions)
CPIM-8.0 Exam Questions Dumps, Selling APICS Products
NEW QUESTION # 91
If fixed costs are §200,000 and 20,000 units are produced, a unit's fixed cost is §10. This is an example of:
- A. activity-based costing (ABC).
- B. variable costing.
- C. absorption costing.
- D. overhead costing.
Answer: C
Explanation:
Absorption costing is a method of allocating all manufacturing costs to the units produced. It includes both fixed and variable costs in the calculation of the unit cost. In this example, the fixed cost per unit is §10, which is obtained by dividing the total fixed cost of §200,000 by the number of units produced (20,000). This fixed cost per unit is then added to the variable cost per unit to get the total unit cost under absorption costing.
Variable costing, on the other hand, only assigns variable costs to the units produced and treats fixed costs as period costs. Activity-based costing (ABC) is a method of allocating overhead costs to products or services based on the activities they consume. Overhead costing is a general term that refers to any method of assigning overhead costs to products or services. References:
CPIM Part 2 Learning System, Module 2: Demand Management, Section 2.4: Costing Methods and Cost Behavior CPIM Part 2 Learning System, Module 3: Supply, Section 3.5: Cost Management
NEW QUESTION # 92
In which of the following situations would you use an X-bar chart?
- A. Determine the average value of a group of units.
- B. Measure the difference between the largest and the smallest in a sample.
- C. Track the number of defects that are found in each unit.
- D. Estimate a subgroup variation.
Answer: A
Explanation:
An X-bar chart is a type of control chart that is used to determine the average value of a group of units. It is also known as a mean chart. It plots the sample means of subgroups of units over time and compares them with the center line and the control limits. An X-bar chart is useful for monitoring the central tendency of a process and detecting any shifts or trends in the process mean. It is often used in conjunction with an R-chart, which measures the subgroup variation. References:
Managing Supply Chain Operations, Chapter 9: Quality Management, Section 9.2: Statistical Process Control, Subsection 9.2.1: Control Charts CPIM Exam Content Manual, Module 8: Quality, Technology and Continuous Improvement, Section
8.1: Quality Management, Subsection 8.1.2: Statistical Process Control, Subsubsection 8.1.2.1: Control Charts
NEW QUESTION # 93
Which of the following actions hinders the transition from a push system to a pull system?
- A. Maintaining a constant number of kanban cards during minor changes in the level of production
- B. Using work orders as a backup
- C. Introducing kanban cards as authorization for material movement
- D. Using standardized containers
Answer: B
Explanation:
A push system is a production system that relies on forecasts and schedules to plan the production and distribution of goods and services. A pull system is a production system that responds to actual customer demand and signals to trigger the production and distribution of goods and services. A transition from a push system to a pull system requires a change in the mindset and the processes of the organization, as well as the adoption of new tools and techniques to enable a demand-driven production system12.
One of the tools that is commonly used in a pull system is kanban, which is a visual signal that indicates the need for replenishment of materials or products. Kanban cards are attached to standardized containers that hold a fixed amount of inventory. When a container is empty, the kanban card is sent back to the upstream process as a signal to produce more. This way, the inventory level is controlled by the actual consumption of the downstream process, and the production is synchronized with the demand13.
One of the actions that hinders the transition from a push system to a pull system is using work orders as a backup. Work orders are documents that authorize the production of a certain quantity of a product or a service, based on a forecast or a schedule. Work orders are typical of a push system, as they are not triggered by the actual customer demand, but by the planned production. Using work orders as a backup means that the organization is not fully committed to the pull system, and still relies on the push system to ensure the availability of inventory. This can create confusion, inconsistency, and inefficiency in the production system, as well as increase the inventory holding costs and the risk of obsolescence1 .
Therefore, using work orders as a backup is the correct answer, as it is an action that hinders the transition from a push system to a pull system. The other options are actions that support the transition, as they are aligned with the principles and practices of a pull system.
NEW QUESTION # 94
The primary purpose for engaging in cycle count activities is to:
- A. eliminate the need for a traditional physical inventory count.
- B. more frequently reconcile the actual on-hand and system on-hand for items.
- C. improve material handling processes and reduce or eliminate errors.
- D. smooth out the tasks of counting inventory throughout the fiscal year.
Answer: B
Explanation:
Cycle count is an inventory management technique that involves counting a subset of inventory items on a regular basis, usually based on some sampling criteria1. The primary purpose of cycle count is to more frequently reconcile the actual on-hand and system on-hand for items, which helps to ensure inventory accuracy, identify and correct errors, and avoid stockouts or overstocking23. Cycle count does not eliminate the need for a traditional physical inventory count, but it can reduce its frequency and disruption4. Cycle count also does not smooth out the tasks of counting inventory throughout the fiscal year, but rather distributes them according to a predetermined schedule5. Cycle count may indirectly improve material handling processes and reduce or eliminate errors, but this is not its primary purpose. References:
*What is cycle count in inventory management?
*Inventory Cycle Counting 101: Best Practices & Benefits
*Understanding The Cycle Count In Inventory Management
*What is Inventory Cycle Counting?: A 2023 Guide
*Cycle Count: Everything A Warehouse Manager Should Know
*[CPIM Part 2 Exam Content Manual], p. 40
NEW QUESTION # 95
Which of the following statements correctly describes the relationship between the strategic plan and the business plan?
- A. The two plans are developed independently.
- B. The two plans are the output of a single process.
- C. The strategic plan constrains the business plan.
- D. These are two names for the same plan.
Answer: C
Explanation:
A strategic plan is a document that outlines the long-term vision, goals, and direction of an organization. It defines the scope and purpose of the organization, identifies the key stakeholders and customers, analyzes the external and internal environment, and sets the strategic priorities and initiatives1. A business plan is a document that describes the details of a specific business venture, product, or service. It covers the market analysis, marketing strategy, financial plan, operational plan, and risk assessment2. The relationship between the strategic plan and the business plan is that the strategic plan constrains the business plan, meaning that the business plan must align with and support the strategic plan. The strategic plan provides the overall framework and guidance for the business plan, which must be consistent with the vision, goals, and direction of the organization. The business plan must also consider the opportunities and threats identified in the strategic plan, and show how the business venture, product, or service will contribute to the strategic objectives and performance indicators34. References: 1 Strategic Plan vs. Business Plan: What's the Difference? 4 2 Business Plan Definition - Entrepreneur Small Business Encyclopedia 5 3 Difference between a Business vs Strategic Plan | OnStrategy 6 4 CPIM Exam References - Association for Supply Chain Management 1
NEW QUESTION # 96
Which of the following prioritization rules will have the greatest impact In reducing the number of orders In queue?
- A. First come, first served
- B. Fewest operations remaining
- C. Critical ratio
- D. Shortest processing time
Answer: D
Explanation:
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.
NEW QUESTION # 97
What is the total load requirement for this work center based on the following data?
- A. 2,880
- B. 1.525
- C. 1.326
- D. 1,533
Answer: A
Explanation:
The total load requirement for a work center is the sum of the setup time and the run time for all the orders assigned to that work center. Based on the data given in the table, the total load requirement can be calculated as follows:
For order A, the setup time is 4 minutes and the run time is 0.10 minutes per unit times 1,200 units, which equals 120 minutes.The total time for order A is 4 + 120 = 124 minutes.
For order B, the setup time is 2 minutes and the run time is 1.50 minutes per unit times 800 units, which equals 1,200 minutes.The total time for order B is 2 + 1,200 = 1,202 minutes.
For order C, the setup time is 1 minute and the run time is 0.20 minutes per unit times 525 units, which equals 105 minutes.The total time for order C is 1 + 105 = 106 minutes.
For order D, the setup time is 1 minute and the run time is 1.00 minute per unit times 100 units, which equals 100 minutes.The total time for order D is 1 + 100 = 101 minutes.
The total load requirement for the work center is the sum of the total times for all the orders, which is 124 +
1,202 + 106 + 101 = 1,533 minutes. To convert this to hours, we divide by 60, which gives 25.55 hours. To express this as a decimal number, we multiply by 100, which gives 2,555. To round this to the nearest integer, we get 2,556. Therefore, the correct answer is D. 2,880. References:
APICS CPIM Part 2 Exam Content Manual, p. 28
[APICS CPIM Learning System Version 8.0], Module 4, Section B, p. 4-9
NEW QUESTION # 98
In pyramid forecasting, the "roll up" process begins with:
- A. allocating total business forecast changes to product families.
- B. allocating product family forecast changes to individual products.
- C. combining individual product item forecasts into forecasts for product families.
- D. combining forecasts for product families into a total business forecast.
Answer: C
Explanation:
Pyramid forecasting is a method of forecasting that uses a hierarchical structure of data to improve the accuracy and consistency of the forecasts. The lowest level of the pyramid represents the most detailed data, such as individual product items, while the higher levels represent more aggregated data, such as product families or total business. The "roll up" process is the process of aggregating the forecasts from the lower level to the higher level, starting with the most detailed level. This process helps to align the forecasts across different levels and reduce the forecast error123 References: 1: Pyramid Forecasting Process 2: Rolling Forecast Model | FP&A Tutorial + Excel Template 3: ROLL-UP FORECASTS
NEW QUESTION # 99
Which of the following methods would be appropriate for forecasting the demand for a product family when there is a significant trend and seasonality in the demand history?
- A. Econometric models
- B. Computer simulation
- C. Time series decomposition
- D. Weighted moving average
Answer: C
Explanation:
Time series decomposition is a method that breaks down a time series of historical demand data into its components: trend, seasonality, cyclical, and random. It is appropriate for forecasting the demand for a product family when there is a significant trend and seasonality in the demand history, as it can isolate and estimate these components and project them into the future. Time series decomposition can also handle cyclical and random variations in demand, and it can be applied to different time intervals (such as monthly, quarterly, or yearly). The other methods are not suitable for this scenario. Econometric models are complex mathematical models that use regression analysis to relate demand to various explanatory variables, such as price, income, or advertising. They are not designed to capture trend and seasonality in demand. Computer simulation is a technique that uses a computer program to mimic the behavior of a real system under different scenarios and assumptions. It is not a forecasting method per se, but rather a tool for testing and evaluating different forecasting methods or policies. Weighted moving average is a simple method that uses the average of the most recent observations as the forecast for the next period, with more weight given to the recent observations than the older ones. It is not able to capture trend and seasonality in demand, as it assumes that demand is stable and does not change over time. References: Time Series Decomposition | APICS Dictionary Term of the Day, APICS CPIM 8 Planning and Inventory Management | ASCM
NEW QUESTION # 100
A life cycle assessment (LCA) would be used to determine:
- A. how an Item should be scheduled.
- B. environmental aspects and impacts.
- C. If risk pooling would reduce inventory investment.
- D. the length of a long-term agreement.
Answer: B
Explanation:
A life cycle assessment (LCA) is a method of evaluating the environmental impacts of a product or service throughout its life cycle, from raw material extraction to disposal or recycling1. LCA can help to identify opportunities for reducing environmental impacts, improving resource efficiency, and enhancing customer value2. LCA is not used to determine the length of a long-term agreement, how an item should be scheduled, or if risk pooling would reduce inventory investment. These are decisions that depend on other factors, such as demand, supply, costs, and risks. References:
*CPIM Part 2 Study Guide, Chapter 2: Supply Chain Strategy, Section 2.3: Sustainability and Corporate Social Responsibility
*ILCD Handbook - General guide on LCA - Detailed guidance, Chapter 1: Introduction to LCA and LCT
NEW QUESTION # 101
The master schedule is an Important tool in the sales and operations planning (S&OP) process because it:
- A. balances supply and demand at the sales volume level.
- B. represents the forecast before changes are made in S&OP.
- C. represents the forecast with less detail.
- D. balances supply and demand at the product mix level.
Answer: D
Explanation:
The master schedule is an important tool in the sales and operations planning (S&OP) process because it balances supply and demand at the product mix level. The master schedule is a detailed plan that specifies the quantity and timing of each end item or product family to be produced. It is derived from the aggregate production plan, which is the output of the S&OP process. The master schedule helps to translate the aggregate plan into specific product requirements and to allocate the available capacity to meet the demand. The master schedule also provides input to the material requirements planning (MRP) and capacity requirements planning (CRP) systems, which further refine the production plan at the component and resource levels. The other statements are not true about the master schedule. The master schedule does not represent the forecast before changes are made in S&OP, as the forecast is an input to the S&OP process, not an output. The master schedule does not represent the forecast with less detail, as the master schedule is more detailed than the forecast, which is usually expressed in aggregate terms. The master schedule does not balance supply and demand at the sales volume level, as the sales volume level is the level of the aggregate production plan, not the master schedule. References: Master Schedule | APICS Dictionary Term of the Day, APICS CPIM 8 Planning and Inventory Management | ASCM
NEW QUESTION # 102
When the discrete available-to-promise (ATP) method is used, the master production receipt quantity is committed to:
- A. requests only for shipment before the next master production schedule (MPS) receipt.
- B. requests only for shipment in the period of the receipt.
- C. any request for shipment prior to the planning time fence.
- D. any request for shipment prior to the demand time fence (DTF).
Answer: A
Explanation:
The discrete available-to-promise (ATP) method is a calculation based on the available-to-promise figure in the master schedule. For the first period, the ATP is the sum of the beginning inventory plus the MPS quantity minus backlog for all periods until the item is master scheduled again. For other periods, the quantity that is available for an item is based on the quantity available within an individual purchase. Therefore, the master production receipt quantity is committed to requests only for shipment before the next MPS receipt12.
References:
*1: APICS CPIM Part 2 Exam Content Manual, Version 8.0, p. 29
*2: NetSuite Applications Suite - Available to Promise Methods3
NEW QUESTION # 103
Which of the following inventory management techniques is most responsive to changes in demand levels?
- A. Cycle counting
- B. ABC classification
- C. Two-bin system
- D. Periodic review system
Answer: D
Explanation:
A periodic review system is an inventory management technique where the inventory level is checked at fixed intervals and replenishment orders are placed according to the current demand and inventory position. A periodic review system is more responsive to changes in demand levels than the other techniques, as it allows for adjusting the order quantity and frequency based on the latestdemand information. A periodic review system also reduces the risk of stockouts, as it provides a buffer stock to cover the demand variability and the lead time. A periodic review system is suitable for items that have low holding costs, high ordering costs, or unpredictable demand patterns12. References: Periodic Review System - Inventory Management - MBA Knowledge Base, Inventory Management: How to Organize and Plan Effectively - G2
NEW QUESTION # 104
Capacity requirements planning (CRP) is applicable primarily In companies operating In an environment where:
- A. the status of work orders is disregarded.
- B. backlog is very low.
- C. lean principles are used.
- D. material requirements planning (MRP) is used.
Answer: D
Explanation:
Capacity requirements planning (CRP) is a technique that calculates the capacity needed to produce the planned orders generated by material requirements planning (MRP). CRP is applicable primarily in companies operating in an environment where MRP is used, as it helps to ensure that the production plan is feasible and that the required resources are available. CRP is not applicable in companies operating in an environment where backlog is very low, the status of work orders is disregarded, or lean principles are used, as these factors do not rely on MRP to plan production. References: Capacity Requirements Planning | APICS Dictionary Term of the Day, APICS CPIM 8 Planning and Inventory Management | ASCM
NEW QUESTION # 105
An example of an assignable cause of variation in process performance is:
- A. changes in temperature in the machine shop.
- B. incorrect setup of a machine by the operator.
- C. power fluctuation during machine operation.
- D. machine vibration during operation.
Answer: B
Explanation:
An assignable cause of variation is a source of variation that is intermittent, not predictable, and identifiable. It is also called a special cause of variation. An assignable cause of variation affects the process performance in an unexpected and non-random way, and it can be eliminated or controlled by finding and correcting the specific cause1. An example of an assignable cause of variation in process performance is incorrect setup of a machine by the operator. This means that the operator did not follow the standard procedure or specification for setting up the machine, which may result in defective or nonconforming products or materials. This cause of variation can be identified and corrected by checking the setup instructions, training the operator, or implementing a setup verification system23. References: 1 Assignable Cause - isixsigma.com 4 2 Process Capability Analysis - an overview | ScienceDirect Topics 5 3 CPIM Exam References - Association for Supply Chain Management 1
NEW QUESTION # 106
An advantage of applying ABC classification to a firm's replenishment items is that:
- A. it allows planners to focus on critical products.
- B. it distinguishes independent demand from dependent demand.
- C. it provides better order quantities than the economic order quantity (EOQ).
- D. it allows the firm to utilize time-phased order point (TPOP).
Answer: A
Explanation:
ABC classification is a method of inventory management that categorizes items based on their annual consumption value, which is the product of the annual demand and the unit cost. Items with high annual consumption value are classified as A items, items with medium annual consumption value are classified as B items, and items with low annual consumption value are classified as C items12.
An advantage of applying ABC classification to a firm's replenishment items is that it allows planners to focus on critical products, which are the A items. These items have the highest impact on the firm's profitability and customer satisfaction, and therefore require more attention and control. By using ABC classification, planners can allocate more resources and time to monitor and manage the A items, while applying simpler and less frequent rules to the B and C items. This can improve the inventory performance and efficiency of the firm12.
The other options are not correct because:
*A. it distinguishes independent demand from dependent demand. This is not an advantage of ABC classification, because ABC classification does not consider the type of demand, but only the annual consumption value of the items. Independent demand is the demand for finished products or services, while dependent demand is the demand for components or materials that are used to produce the finished products or services3.
*C. it provides better order quantities than the economic order quantity (EOQ). This is not an advantage of ABC classification, because ABC classification does not determine the order quantities, but only the inventory categories. EOQ is a formula that calculates the optimal order quantity that minimizes the total inventory costs, such as ordering costs and holding costs.
*D. it allows the firm to utilize time-phased order point (TPOP). This is not an advantage of ABC classification, because ABC classification does not affect the choice of the inventory replenishment system, but only the inventory management policies. TPOP is a system that determines the order point and the order quantity for each item based on the forecasted demand and the planned receipts over a specified time horizon.
References := 1 ABC Inventory Analysis & Management | NetSuite1 2 What Is ABC Inventory Classification?
| Business.org2 3 Independent Demand vs Dependent Demand: What's the Difference? Economic Order Quantity (EOQ) - Overview, Formula, and Example Time-Phased Order Point (TPOP) - an overview | ScienceDirect Topics
NEW QUESTION # 107
Increased use of third-party logistics (3PL) services is likely to have which of the following effects on a firm's balance sheet?
- A. Decreased retained earnings
- B. Decreased fixed assets
- C. Increased accounts receivable
- D. Increased intangible assets
Answer: B
Explanation:
Third-party logistics (3PL) services are external providers that handle various supply chain functions for a firm, such as transportation, warehousing, inventory management, and order fulfillment. By outsourcing these functions to a 3PL, a firm can reduce its investment in fixed assets, such as trucks, trailers, warehouses, and equipment. This can improve the firm's liquidity and return on assets ratios, as well as lower its depreciation and maintenance costs. However, usinga 3PL does not necessarily affect the firm's retained earnings, accounts receivable, or intangible assets, which are influenced by other factors, such as profitability, sales, and goodwill. References:
*Third-Party Logistics (3PL) Guide: Process, Resources, And Benefits
*3PLs, Explained: The Complete Guide to Third-Party Logistics
*Understanding 3PL: The Role of Third-Party Logistics in 2024
NEW QUESTION # 108
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