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CIPS Whole Life Asset Management Sample Questions (Q32-Q37):

NEW QUESTION # 32
Which of the following best describes the term 'periodic review'?

A. Items are reviewed when the price is at its lowest
B. Items are reviewed as part of an imprest system
C. Items are reviewed when the Kanban is triggered
D. Items are reviewed and orders placed depending on requirements

Answer: B

Explanation:
Fixed-Time Period System (or Periodic Review system) is the inventory management system in which inventory is checked in fixed time periods, T, and the quantity ordered varies.
The imprest system is a form of financial accounting system. The most common imprest system is the petty cash system. The base characteristic of an imprest system is that a fixed amount is re-served, which after a certain period of time or when circumstances require, because money was spent, it will be replenished.
So the correct answer should be "Items are reviewed as part of an imprest system" LO 2, AC 2.3

NEW QUESTION # 33
Which of the following best describes available inventory (also known as inventory position)?

A. The amount of inventory on hand plus the amount of inventory on order
B. The amount of inventory on hand
C. The amount of inventory on order only
D. The amount of inventory on hand in excess of expected demand

Answer: A

Explanation:
Available inventory (or Inventory position - IP) is equal to inventory on-hand plus quantity on order minus backorder (if any) Reference:
LO 2, AC 2.3

NEW QUESTION # 34
A piece of machinery has reached the end of its manufacturing life cycle and is due to be disposed of. What is the process that must take place for this to occur?

A. Decommissioning
B. Inventory management
C. Commissioning
D. Whole-life costing

Answer: A

Explanation:
Decommissioning is the process of safely retiring equipment from use. It involves steps such as cleaning, dismantling, and responsibly disposing of the asset, especially if it contains hazardous materials. Whole-life asset management includes decommissioning as a key phase, ensuring that assets are disposed of cost- effectively and in compliance with environmental standards.

NEW QUESTION # 35
Buffer stock is a level of stock which ...

A. is when the physical ordering process should start to replenish used items
B. is the maximum stock in inventory
C. is half of the actual stock that needs to be in the warehouse
D. is the minimum stock level below which actual stock should not fall

Answer: D

Explanation:
Buffer stock serves as a safety net to prevent stockouts by ensuring that a minimum stock level is always maintained. This strategy is essential in whole-life asset management to manage demand fluctuations and minimize the risk of supply chain disruptions.

NEW QUESTION # 36
What advantage can the use of ABC classification of stock provide in warehouse design?

A. It gives purchasing staff more time to concentrate on those items that have most financial benefit to the organisation
B. It determines where each item is to be located within the warehouse to aid inspection procedures
C. It assists in deciding on the most appropriate layout, handling systems, and what type of picking system to introduce
D. It allows the organisation to categorise items in alphabetical order for easier storage and retrieval

Answer: C

NEW QUESTION # 37
......

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Accurate CIPS L4M7 Prep Material | L4M7 Exam Torrent

2025 Accurate L4M7 Prep Material Free PDF | High-quality L4M7 Exam Torrent: CIPS Whole Life Asset Management

CIPS Whole Life Asset Management Sample Questions (Q32-Q37):

New CIPS L4M7 Dumps - Get Ready With L4M7 Exam Questions

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