CIPS L4M7 WHOLE LIFE
ASSET MANAGEMENT
PRACTICE TEST 60
QUESTIONS
Question 1: A manufacturer is choosing a location for a regional warehouse that will receive imported components and distribute them to three factories. Which factor is most likely to reduce both inbound and outbound transport time?
Choices:
1) Locating close to major transport links serving the port and factories 2) Locating in the area with the lowest local property tax regardless of access 3) Locating as far as possible from congested industrial areas 4) Locating next to the head o�ce even if it is remote from production sites Correct Answer: Locating close to major transport links serving the port and factories Explanation: A warehouse close to suitable road, rail, port, or other transport links can reduce travel distance and lead time for both inbound receipts and outbound deliveries. Property cost matters, but location should support the required logistics �ow.Page 1
Question 2: A warehouse redesign aims to reduce unnecessary travel by pickers.
Which layout decision is most appropriate?
Choices:
1) Place slow-moving items nearest the dispatch doors 2) Locate high-frequency items close to picking and dispatch areas 3) Increase aisle length so more products �t in each aisle 4) Separate receiving and dispatch as widely as possible
Correct Answer: Locate high-frequency items close to picking and dispatch areas
Explanation: Fast-moving items should usually be positioned where they require the least handling and travel. This improves �ow, shortens picking time, and reduces labour and equipment movement.Question 3: A distribution centre receives full pallets from suppliers and immediately sorts the goods into outbound loads with little or no storage. Which approach is being used?
Choices:
1) Cycle counting 2) Economic order quantity 3) Cross-docking 4) ABC classi�cation
Correct Answer: Cross-docking
Explanation: Cross-docking moves incoming goods rapidly from receiving to outbound dispatch with minimal storage. It is useful where timing and coordination are strong and can reduce storage time and handling.Page 2
Question 4: Why might an organisation use a structured alphanumeric product
coding system rather than descriptions alone?
Choices:
1) To eliminate the need for any physical inventory checks 2) To guarantee that all suppliers use the same selling price 3) To prevent products from ever becoming obsolete 4) To ensure every item has a unique and consistently searchable identi�er Correct Answer: To ensure every item has a unique and consistently searchable identi�er Explanation: A well-designed product code provides a unique identi�er that supports ordering, storage, recording, and retrieval. It reduces ambiguity that can arise when similar items have similar written descriptions.Question 5: Which limitation is most associated with conventional one-dimensional barcodes compared with RFID?
Choices:
1) Barcodes normally require line-of-sight scanning 2) Barcodes cannot contain any product identi�cation data 3) Barcodes can only be used on �nished goods 4) Barcodes cannot be generated by warehouse systems
Correct Answer: Barcodes normally require line-of-sight scanning
Explanation: Conventional barcodes generally need the scanner to see the printed code. RFID tags can often be read without direct line of sight and, depending on the system, multiple tags can be read quickly.Page 3