Practice Test Geeks(APP) Accredited Purchasing Practitioner Certification Practice Test
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Inventory, Logistics & Supply Chain Management Flashcards

7 cards from real APP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Inventory, Logistics & Supply Chain Management flashcards as text

  1. Which inventory valuation method results in the highest cost of goods sold during a period of rising prices?

    Answer: LIFO (Last-In, First-Out)

    Under LIFO, the most recently purchased (and therefore most expensive) items are sold first, producing the highest COGS when prices are rising.

  2. A purchasing manager wants to evaluate a 3PL provider. Which key performance indicator (KPI) measures the 3PL's ability to deliver complete, accurate, on-time orders without damage?

    Answer: Perfect Order Rate

    Perfect Order Rate measures the percentage of orders delivered complete, on time, undamaged, and with accurate documentation — the most comprehensive 3PL fulfillment KPI.

  3. What is the primary purpose of vendor-managed inventory (VMI)?

    Answer: To allow the supplier to monitor stock levels and replenish inventory autonomously

    In VMI, the supplier monitors the buyer's inventory data and takes responsibility for maintaining agreed stock levels, reducing the buyer's replenishment workload.

  4. Under Incoterms 2020, which term places maximum responsibility on the buyer?

    Answer: EXW (Ex Works)

    EXW places the least obligation on the seller — the buyer is responsible for all transportation, export clearance, insurance, and import duties from the seller's premises.

  5. A company uses a two-bin replenishment system. What triggers the reorder action?

    Answer: The first bin is emptied, signaling use of the second (safety) bin

    In a two-bin system, the second bin is a visual trigger — when the first bin empties and the second bin is opened, a replenishment order is placed.

  6. Which supply chain visibility tool provides real-time tracking of goods in transit and is most critical for managing perishable or high-value shipments?

    Answer: Transportation Management System (TMS) with GPS tracking integration

    A TMS with GPS/IoT tracking integration provides real-time in-transit visibility, enabling proactive intervention for temperature-sensitive or high-value shipments.

  7. In lean supply chain thinking, 'muda' refers to:

    Answer: Any activity or resource use that does not add value to the customer

    Muda is the Japanese term for waste — any activity consuming resources without creating customer value, such as excess inventory, overproduction, or unnecessary transportation.