Free CIPS L4M7 Exam Questions

Question 1

The managing director requires action to be taken to improve the organization’s profitability and has asked for suggestions to enable this to be achieved. The procurement manager has said that a just-in-time (JIT) system should be introduced. Would such a system improve profitability?

A : Yes, because it would reduce stock holding costs

B : No, because it would increase buffer stock

C : No, because it would increase stock holding costs

D : Yes, because it would reduce stock turn rates

Answer: A

Question 2

The managing director requires action to be taken to improve the organization’s profitability and has asked for suggestions to enable this to be achieved. The procurement manager has said that a just-in-time (JIT) system should be introduced. Would such a system improve profitability?

A : Yes, because it would reduce stock holding costs

B : No, because it would increase buffer stock

C : No, because it would increase stock holding costs

D : Yes, because it would reduce stock turn rates

Answer: A

Question 3

Which of the following is the material handling equipment which uses the suction force to lift an item?

A : llet stacker

B : lly

C : cuum lifter

D : ck truck

Answer: C

Question 4

A warehouse manager is evaluating the use of Automated Guided Vehicles (AGVs) within a repetitive taskenvironment. After reviewing their use and price, the manager decided to invest in several AGVs. Were theycorrect in doing this?

A : Yes, as it will reduce the costs of employing labour

B : No, as it reduces the flexibility of the warehouse operations

C : Yes, organisations must use high-tech solutions where possible

D : No, as they are only suitable for use in non-repetitive task environments

Answer: A

Question 5

A company bought 100 items for $15 each and then another 100 items for $20 each. It sold 60 items and assumed the COSG for each item was $15. It also assumed the value of the remaining 140 items was split into two groups: 40 items worth $15 each and 100 items worth $20 each. This is an example of…?

A : Last in, First out method

B : Just in Time method

C : Net Present Value

D : First in, First out method

Answer: D