CPIM APICS EXAM 2025/2026 QUESTIONS WITH ANSWERS
MARKED A+
✔✔Business plan - ✔✔Statement of long-range strategy and revenue, cost, and profit
objectives usually accompanied by budgets, a projected balance sheet, and a cash flow
(source and application of funds) statement; document consisting of the business
details (organization, strategy, and financing tactics)
✔✔Capable-2-promise - ✔✔Process of committing orders against available capacity as
well as inventory. May involve multiple manufacturing or distribution sites. Used to
determine when a new or unscheduled customer order can be delivered. Employs a
finite-scheduling model of manufacturing system to determine when an item can be
delivered. Includes any constraints that might restrict production, such as availability of
resources, lead times for raw materials or purchased parts, and requirements for lower-
level components or subassemblies. The resulting delivery date takes into consideration
production capacity, current manufacturing environment, and future order commitments.
Objective is to reduce time spent by planners in expediting orders and adjusting plans
because of inaccurate delivery-date promises
✔✔Capacity control - ✔✔Process of measuring production output and comparing it with
the capacity plan to determine if variance exceeds pre-established limits and taking
action to get back on plan if limits are exceeded
✔✔Capacity management - ✔✔Function of establishing, measuring, monitoring, and
adjusting limits of capacity in order to execute all mfg schedules; executed at 4 levels:
resource requirements planning, rough-cut capacity planning, capacity requirements
planning, and input/output control
✔✔Capacity planning - ✔✔Process of determining amount of capacity required to
produce in the future; may be performed at aggregate or product-line (RRP), master-
schedule level (R-CCP), and materials requirements planning (CRP)
✔✔Capacity requirements planning (CRP) - ✔✔Process of determining in detail amount
of labor and machine resources required to complete task of production; inputs are
open orders and planned orders; checks against all time periods
✔✔Carrying cost - ✔✔% of dollar value of inventory per unit of time (generally one
year); depends mainly on the cost of capital invested as well as such costs of
maintaining the inventory as taxes and insurance, obsolescence, spoilage, and space
occupied; varies from 10% to 35% annually, depending on type of industry
✔✔Cash flow - ✔✔Net flow of dollars into or out of the proposed project; algebraic sum,
in any time period, of all cash receipts, expenses, and investments
✔✔Cause-and-effect diagram - ✔✔Tool for analyzing process dispersion
, ✔✔Cellular manufacturing - ✔✔Mfg process that produces families of parts within a
single line or cell of machines controlled by operators who work only within the line or
cell
✔✔Chase production method - ✔✔Production planning method that maintains stable
inventory level while varying production to meet demand
✔✔Continuous replenishment - ✔✔Process by which supplier is notified daily of actual
sales or warehouse shipments and commits to replenish
✔✔Control chart - ✔✔Graphic comparison of process performance data with
predetermined computed control limits; primary use is to detect assignable causes of
variation in the process (as opposed to random ones)
✔✔Control limit - ✔✔Statistically determined line on a control chart (upper control limit
or lower control limit)
✔✔Cost of poor quality - ✔✔Costs associated with providing poor quality products or
services: (1) internal failure costs (2) external failure costs (3) appraisal costs (costs
incurred to determine the degree of conformance to quality requirements (4) prevention
costs
✔✔Critical path method (CPM) - ✔✔Network planning technique for analysis of project's
completion time used for planning & controlling the activities in the project; by showing
each activity and associated time to complete identifies those elements that actually
constrain the total project time, determining the critical path
✔✔Cross-docking - ✔✔Concept of packing products on the incoming shipments so they
can be easily sorted at intermediate warehouses or for outgoing shipments based on
final destinations; items are carried from incoming vehicle docking point to outgoing
vehicle docking point without being stored in inventory in the warehouse
✔✔Cycle stock - ✔✔Average amount of inventory a business needs to meet customer
demand between the times it orders more inventory from suppliers
✔✔Cycle time - ✔✔In materials management, it refers to the length of time from when
material enters a production facility until it exits; in industrial engineering, the time
between completions of two discrete units of production.
✔✔Decoupling inventory - ✔✔Amount of inventory kept between entities in a mfg or
distribution network to create independence between processes or entities; objective is
to disconnect the rate of use from the rate of supply of the item
MARKED A+
✔✔Business plan - ✔✔Statement of long-range strategy and revenue, cost, and profit
objectives usually accompanied by budgets, a projected balance sheet, and a cash flow
(source and application of funds) statement; document consisting of the business
details (organization, strategy, and financing tactics)
✔✔Capable-2-promise - ✔✔Process of committing orders against available capacity as
well as inventory. May involve multiple manufacturing or distribution sites. Used to
determine when a new or unscheduled customer order can be delivered. Employs a
finite-scheduling model of manufacturing system to determine when an item can be
delivered. Includes any constraints that might restrict production, such as availability of
resources, lead times for raw materials or purchased parts, and requirements for lower-
level components or subassemblies. The resulting delivery date takes into consideration
production capacity, current manufacturing environment, and future order commitments.
Objective is to reduce time spent by planners in expediting orders and adjusting plans
because of inaccurate delivery-date promises
✔✔Capacity control - ✔✔Process of measuring production output and comparing it with
the capacity plan to determine if variance exceeds pre-established limits and taking
action to get back on plan if limits are exceeded
✔✔Capacity management - ✔✔Function of establishing, measuring, monitoring, and
adjusting limits of capacity in order to execute all mfg schedules; executed at 4 levels:
resource requirements planning, rough-cut capacity planning, capacity requirements
planning, and input/output control
✔✔Capacity planning - ✔✔Process of determining amount of capacity required to
produce in the future; may be performed at aggregate or product-line (RRP), master-
schedule level (R-CCP), and materials requirements planning (CRP)
✔✔Capacity requirements planning (CRP) - ✔✔Process of determining in detail amount
of labor and machine resources required to complete task of production; inputs are
open orders and planned orders; checks against all time periods
✔✔Carrying cost - ✔✔% of dollar value of inventory per unit of time (generally one
year); depends mainly on the cost of capital invested as well as such costs of
maintaining the inventory as taxes and insurance, obsolescence, spoilage, and space
occupied; varies from 10% to 35% annually, depending on type of industry
✔✔Cash flow - ✔✔Net flow of dollars into or out of the proposed project; algebraic sum,
in any time period, of all cash receipts, expenses, and investments
✔✔Cause-and-effect diagram - ✔✔Tool for analyzing process dispersion
, ✔✔Cellular manufacturing - ✔✔Mfg process that produces families of parts within a
single line or cell of machines controlled by operators who work only within the line or
cell
✔✔Chase production method - ✔✔Production planning method that maintains stable
inventory level while varying production to meet demand
✔✔Continuous replenishment - ✔✔Process by which supplier is notified daily of actual
sales or warehouse shipments and commits to replenish
✔✔Control chart - ✔✔Graphic comparison of process performance data with
predetermined computed control limits; primary use is to detect assignable causes of
variation in the process (as opposed to random ones)
✔✔Control limit - ✔✔Statistically determined line on a control chart (upper control limit
or lower control limit)
✔✔Cost of poor quality - ✔✔Costs associated with providing poor quality products or
services: (1) internal failure costs (2) external failure costs (3) appraisal costs (costs
incurred to determine the degree of conformance to quality requirements (4) prevention
costs
✔✔Critical path method (CPM) - ✔✔Network planning technique for analysis of project's
completion time used for planning & controlling the activities in the project; by showing
each activity and associated time to complete identifies those elements that actually
constrain the total project time, determining the critical path
✔✔Cross-docking - ✔✔Concept of packing products on the incoming shipments so they
can be easily sorted at intermediate warehouses or for outgoing shipments based on
final destinations; items are carried from incoming vehicle docking point to outgoing
vehicle docking point without being stored in inventory in the warehouse
✔✔Cycle stock - ✔✔Average amount of inventory a business needs to meet customer
demand between the times it orders more inventory from suppliers
✔✔Cycle time - ✔✔In materials management, it refers to the length of time from when
material enters a production facility until it exits; in industrial engineering, the time
between completions of two discrete units of production.
✔✔Decoupling inventory - ✔✔Amount of inventory kept between entities in a mfg or
distribution network to create independence between processes or entities; objective is
to disconnect the rate of use from the rate of supply of the item
