APICS CSCP EXAM QUESTIONS ANSWERS
SET 2026 CONFIRMED
⫸ value chain Answer: the functions within a company that add value to
the goods/services that the org. sells to customers and for which it
receives payment
⫸ spend management Answer: managing the outflow of funds in order
to buy goods and services
⫸ service industry Answer: 1. an org that provides an intangible product
2. all orgs except farming, mining, and manufacturing
⫸ return on investment Answer: a relative measure of financial
performance that provides a means for comparing various investments
by calculating the profits returned during a specified time period. in the
theory of constraints, this is calculated as (throughput - operating
expenses)/investment
⫸ strategic planning Answer: the process of developing a strategic plan
⫸ value stream Answer: The process of creating, producing, and
delivering a good or service to the market
⫸ obsolecense Answer: 1. the condition of being out of date
,2. the decrease in the value of an asset brought about by the
development of new and more economical processes, methods, or
machinery
3. the loss of usefulness or worth of a product or facility as the result of
the appearance of better or more economical products or facilities
⫸ return on assets Answer: net income for the previous 12 months/total
assets
⫸ inventory valuation Answer: the value of the inventory at either its
cost or its market value. cost value of inventory is computed on a FIFO,
LIFO, or standard cost basis to establish cost of goods sold
⫸ value stream mapping Answer: a lean production tool to visually
understand the flow of materials from supplier to customer that includes
the current process and flow as well as the value- and non value-added
steps
⫸ keiretsu Answer: a form of cooperative relationship among
companies in Japan where the companies remain largely independent,
even though they work closely in many ways such as financial backing
⫸ push system Answer: 1. in production, the production of items at
times required by a given schedule planned ahead
2. in material control, the issuing of material according to a given
schedule
,3. in distribution, a system for replenishing field warehouses where
replenishment decision making is centralized, usually at the
manufacturing site
⫸ partnership Answer: 1. a form of business ownership that is not
organized as a separate legal entity, but entailing ownership by 2+
persons
2. in supply chain, a relationship based on trust, shared risk, and rewards
aimed at achieving a competitive adantage
⫸ value added Answer: 1. in accounting, the addition of direct labor,
direct material, and allocated overhead assigned at an operation
2. in manufacturing, the actual increase in utility from the viewpoint of
the customer as a part is transformed from raw material to finished
inventory
⫸ global strategy Answer: a strategy that focuses on improving
worldwide performance through sales and marketing of common goods
and services with minimum product variation by country
⫸ cost of goods sold Answer: an accounting classification useful for
determining the amount of direct materials, direct labor, and allocated
overhead associated with the products sold during a given period of time
⫸ pull system Answer: 1. in production, the production of items only as
demanded for use or to replace those taken for use
, 2. in material control, the withdrawal of inventory as demanded by the
using operations
3. in distribution, a system where replenishment decisions are made at
the field warehouse
⫸ supply chain management Answer: the design, planning, execution,
control, and monitoring of supply chain activities with the objective of
creating net value, building a competitive infrastructure, leveraging
worldwide logistics, synchronizing supply with demand, and measuring
performance globally
⫸ product differentiation Answer: a strategy of making a product
distinct from the competition on a nonprice basis such as availability,
durability, reliability, or quality
⫸ innovative products Answer: products that tend to have a high profit
margin, be unique, have less competition, and have dynamic demand
⫸ market share Answer: the actual portion of current market demand
that a company or product achieves
⫸ multicountry strategy Answer: a strategy in which each country
market is self-contained. Customers have uni8que product expectations
that are addressed by local product capabilities
SET 2026 CONFIRMED
⫸ value chain Answer: the functions within a company that add value to
the goods/services that the org. sells to customers and for which it
receives payment
⫸ spend management Answer: managing the outflow of funds in order
to buy goods and services
⫸ service industry Answer: 1. an org that provides an intangible product
2. all orgs except farming, mining, and manufacturing
⫸ return on investment Answer: a relative measure of financial
performance that provides a means for comparing various investments
by calculating the profits returned during a specified time period. in the
theory of constraints, this is calculated as (throughput - operating
expenses)/investment
⫸ strategic planning Answer: the process of developing a strategic plan
⫸ value stream Answer: The process of creating, producing, and
delivering a good or service to the market
⫸ obsolecense Answer: 1. the condition of being out of date
,2. the decrease in the value of an asset brought about by the
development of new and more economical processes, methods, or
machinery
3. the loss of usefulness or worth of a product or facility as the result of
the appearance of better or more economical products or facilities
⫸ return on assets Answer: net income for the previous 12 months/total
assets
⫸ inventory valuation Answer: the value of the inventory at either its
cost or its market value. cost value of inventory is computed on a FIFO,
LIFO, or standard cost basis to establish cost of goods sold
⫸ value stream mapping Answer: a lean production tool to visually
understand the flow of materials from supplier to customer that includes
the current process and flow as well as the value- and non value-added
steps
⫸ keiretsu Answer: a form of cooperative relationship among
companies in Japan where the companies remain largely independent,
even though they work closely in many ways such as financial backing
⫸ push system Answer: 1. in production, the production of items at
times required by a given schedule planned ahead
2. in material control, the issuing of material according to a given
schedule
,3. in distribution, a system for replenishing field warehouses where
replenishment decision making is centralized, usually at the
manufacturing site
⫸ partnership Answer: 1. a form of business ownership that is not
organized as a separate legal entity, but entailing ownership by 2+
persons
2. in supply chain, a relationship based on trust, shared risk, and rewards
aimed at achieving a competitive adantage
⫸ value added Answer: 1. in accounting, the addition of direct labor,
direct material, and allocated overhead assigned at an operation
2. in manufacturing, the actual increase in utility from the viewpoint of
the customer as a part is transformed from raw material to finished
inventory
⫸ global strategy Answer: a strategy that focuses on improving
worldwide performance through sales and marketing of common goods
and services with minimum product variation by country
⫸ cost of goods sold Answer: an accounting classification useful for
determining the amount of direct materials, direct labor, and allocated
overhead associated with the products sold during a given period of time
⫸ pull system Answer: 1. in production, the production of items only as
demanded for use or to replace those taken for use
, 2. in material control, the withdrawal of inventory as demanded by the
using operations
3. in distribution, a system where replenishment decisions are made at
the field warehouse
⫸ supply chain management Answer: the design, planning, execution,
control, and monitoring of supply chain activities with the objective of
creating net value, building a competitive infrastructure, leveraging
worldwide logistics, synchronizing supply with demand, and measuring
performance globally
⫸ product differentiation Answer: a strategy of making a product
distinct from the competition on a nonprice basis such as availability,
durability, reliability, or quality
⫸ innovative products Answer: products that tend to have a high profit
margin, be unique, have less competition, and have dynamic demand
⫸ market share Answer: the actual portion of current market demand
that a company or product achieves
⫸ multicountry strategy Answer: a strategy in which each country
market is self-contained. Customers have uni8que product expectations
that are addressed by local product capabilities
