MB-920 Describe Dynamics 365 Supply Chain Management — Timed 100 Questions

Question 1

A manufacturing company is experiencing stockouts of a critical raw material despite maintaining high inventory levels. The procurement team places purchase orders based on historical usage, but demand has become erratic. Which action should the supply chain manager take to improve material availability without increasing inventory costs?

Accepted Answer

Set up a reorder point with dynamic safety stock calculation in Demand Planning.. Option B is correct because Dynamics 365 Supply Chain Management's Demand Planning module can calculate dynamic safety stock based on forecasted demand variability and service level targets. This allows the system to automatically adjust reorder points in response to erratic demand patterns, improving material availability without simply increasing inventory levels across the board.

Answer

Increase safety stock percentages for all raw materials by 20%.

Answer

Switch from purchase orders to blanket purchase agreements with the supplier.

Answer

Negotiate with the supplier to reduce lead time by 50%.

Question 2

A distribution company uses Dynamics 365 Supply Chain Management to manage its warehouse operations. The warehouse manager reports that during peak hours, order picking is slow because pickers frequently travel long distances to retrieve items. The warehouse layout is fixed. Which feature should the company use to optimize picking routes without changing the physical layout?

Accepted Answer

Configure wave processing with location-based wave filters.. Wave processing with location-based wave filters allows the system to group work into waves based on criteria such as location, enabling the creation of efficient picking routes that minimize travel distance. This feature optimizes the sequence of picks within a wave without requiring any physical changes to the warehouse layout, directly addressing the manager's need to reduce travel time during peak hours.

Answer

Enable replenishment to ensure pick locations are fully stocked.

Answer

Use location directives to direct putaway to random locations.

Answer

Implement cluster picking to group orders by customer.

Question 3

A company uses Dynamics 365 Supply Chain Management to manage production orders. A production planner needs to schedule a rush order for a high-priority customer. The planner wants to see the impact on existing orders before committing. Which feature should the planner use?

Accepted Answer

Gantt chart scheduling on the production floor control board.. The Gantt chart on the production floor control board provides a visual, interactive timeline that allows the planner to simulate the insertion of a rush order and immediately see its effect on existing production orders, including potential delays or resource conflicts. This feature supports 'what-if' analysis before committing the order, which directly matches the requirement to assess impact on existing orders.

Answer

Finite scheduling on the resource group.

Answer

Production order details form.

Answer

Capacity planning workspace.

Question 4

A company uses Dynamics 365 Supply Chain Management to manage its supply chain. The procurement manager notices that purchase requisitions are not being converted to purchase orders automatically as expected. The workflow for purchase requisitions is set to auto-approve for amounts under $1,000. Upon investigation, the manager finds that a requisition for $950 is stuck in 'Draft' status. What is the most likely cause?

Accepted Answer

The purchase requisition has not been submitted for review.. Option D is correct because in Dynamics 365 Supply Chain Management, a purchase requisition must be explicitly submitted to trigger the workflow. Even if the workflow is configured for auto-approval, the requisition remains in 'Draft' status until the user clicks 'Submit'. The $950 requisition was never submitted, so the auto-approval process never started.

Answer

The workflow requires budget approval for all requisitions.

Answer

The purchase requisition was rejected by the workflow.

Answer

The dollar limit for auto-approval is set to $900.

Question 5

A company uses Dynamics 365 Supply Chain Management for warehouse operations. The warehouse manager wants to improve inventory accuracy and reduce the time spent on physical inventory counts. Which TWO actions should the manager take?

Accepted Answer

Implement cycle counting based on ABC classification.. Cycle counting based on ABC classification allows the warehouse to count high-value or fast-moving items (A items) more frequently than low-value or slow-moving items (C items). This targeted approach improves inventory accuracy without the disruption of full physical counts, and Dynamics 365 Supply Chain Management supports ABC classification directly in the cycle counting setup.

Answer

Increase safety stock levels for fast-moving items.

Answer

Schedule full inventory counts at the end of each month.

Answer

Require daily counting of all inventory items.

Question 6

A manufacturing company uses Dynamics 365 Supply Chain Management. The production manager wants to reduce setup time on a bottleneck machine. Which THREE actions should the manager take?

Accepted Answer

Define operation properties to sequence orders by setup similarity.. Option A is correct because defining operation properties allows the system to sequence production orders on a bottleneck resource based on setup similarity, reducing changeover time. In Dynamics 365 Supply Chain Management, operation properties are attributes assigned to operations that the scheduling engine uses to group similar setups together, minimizing the number and duration of setup changes.

Answer

Increase the batch size for all production orders on that machine.

Answer

Implement external setup procedures that run while the machine is running.

Question 7

Refer to the exhibit. A batch job for inventory closing failed. The error indicates open inventory transactions for item A-100. What should the supply chain analyst do to resolve the issue and allow inventory closing to complete?

Accepted Answer

Post or cancel the open inventory transactions for item A-100.. Inventory closing cannot complete while there are open inventory transactions (e.g., sales orders, production orders, or transfer orders) that have not been posted or canceled. The correct action is to post or cancel those open transactions for item A-100, which clears the blocking records and allows the inventory closing batch job to finalize. This is a standard prerequisite in Dynamics 365 Supply Chain Management for inventory close processes.

Answer

Perform a physical inventory count for item A-100.

Answer

Change the batch job recurrence to run every hour.

Answer

Rerun the batch job immediately after the next scheduled run.

Question 8

Contoso, Ltd. is a manufacturer of custom machinery. They use Dynamics 365 Supply Chain Management with production orders and subcontracting. A production order for a custom drilling machine requires a specialized heat treatment process that is performed by an external vendor. The heat treatment is set up as a route operation with a resource of type 'Vendor' and a subcontracting purchase agreement. The production order has been released and started, but the vendor reports that they have not received the purchase order for the heat treatment service. The production planner checks the purchase order and finds that it has not been created yet. The planner confirms that the purchase agreement is active and covers the required service. What is the most likely reason that the purchase order was not automatically generated?

Accepted Answer

The operation for heat treatment has not been scheduled on the production route.. In Dynamics 365 Supply Chain Management, a subcontracting purchase order is automatically generated only after the corresponding route operation has been scheduled on the production route. Without scheduling, the system does not know when the service is needed and therefore does not trigger the purchase order creation, even if the purchase agreement is active and the production order has been released.

Answer

The purchase agreement has expired or is not approved.

Answer

The production order status is 'Estimated' and needs to be released first.

Answer

The vendor resource is not set up correctly in the system.

Question 9

A manufacturing company uses Dynamics 365 Supply Chain Management. They want to improve inventory accuracy and reduce stockouts. Which TWO actions should they take?

Accepted Answer

Use cycle counting to regularly verify inventory.. Cycle counting (A) is a continuous inventory verification method that allows frequent, focused counts of specific items without disrupting operations. This directly improves inventory accuracy by identifying and correcting discrepancies in real time, which helps prevent stockouts by ensuring system records match physical stock. Setting safety stock levels (C) provides a buffer of inventory for critical items, reducing the risk of stockouts during demand fluctuations or supply delays.

Answer

Implement ABC classification for all items.

Answer

Enable sales forecasting for all products.

Answer

Conduct annual physical inventory counts.

Question 10

Contoso Ltd. is a global manufacturer of industrial pumps. They use Dynamics 365 Supply Chain Management with warehouse management (WMS) enabled. The warehouse in Chicago has been experiencing frequent inventory discrepancies during cycle counting. The discrepancies are mostly for items stored in bulk locations (floor storage) with high movement volume. The warehouse manager suspects that the issue is related to how inventory transactions are processed during outbound picking. When pickers confirm a pick, the system immediately reduces on-hand inventory. However, the physical movement to the staging area often happens later, sometimes after the system confirmation. This timing difference leads to phantom inventory. The manager wants to avoid a full physical inventory and implement a solution that aligns system and physical movements without major process changes. They consider four options:

A. Enable negative inventory adjustments for bulk locations.
B. Use the 'Registration' process instead of picking confirmation for outbound orders.
C. Implement a staging location and use the 'Stage for packing' functionality to defer inventory reduction until the item is physically staged.
D. Disable cycle counting for bulk locations and rely on annual physical counts.

Which option should Contoso implement?

Accepted Answer

Implement a staging location and use the 'Stage for packing' functionality to defer inventory reduction until the item is physically staged.. Option C is correct because implementing a staging location with the 'Stage for packing' functionality allows the system to defer inventory reduction until the item is physically moved to the staging area. This aligns the system transaction with the physical movement, eliminating the phantom inventory caused by early picking confirmation. It solves the timing discrepancy without requiring major process changes or a full physical inventory.

Answer

Disable cycle counting for bulk locations and rely on annual physical counts.

Answer

Enable negative inventory adjustments for bulk locations.

Answer

Use the 'Registration' process instead of picking confirmation for outbound orders.

Question 11

Drag and drop the steps to configure a sales order in Dynamics 365 Supply Chain Management in the correct order.

Question 12

Drag and drop the steps to configure a new inventory item in Dynamics 365 Supply Chain Management in the correct order.

Question 13

Match each Dynamics 365 Supply Chain Management concept to its description.

Question 14

Match each Dynamics 365 Project Operations pricing method to its description.

Question 15

A manufacturing company is implementing Dynamics 365 Supply Chain Management. They need to track raw material consumption and finished goods output in real time. Which module should they configure to achieve this?

Accepted Answer

Production control. Production control is the correct module because it is specifically designed to manage and track manufacturing processes, including real-time consumption of raw materials and output of finished goods through production orders, batch orders, and kanban jobs. It integrates with inventory to automatically post material consumption and finished goods receipt as production operations are reported.

Answer

Inventory management

Answer

Warehouse management

Answer

Procurement and sourcing

Question 16

A distribution company uses Dynamics 365 Supply Chain Management. They notice that warehouse workers are scanning incorrect items during picking, leading to shipment errors. Which feature should they implement to reduce errors?

Accepted Answer

License plate tracking. License plate tracking (LPT) enables warehouse workers to scan a unique barcode on each pallet or container, which is linked to the exact inventory items and quantities in the system. By requiring a license plate scan during picking, the system validates that the correct item is being picked, preventing incorrect item selection and reducing shipment errors.

Answer

Cycle counting

Answer

RFID scanning

Answer

Wave processing

Question 17

A company wants to automate the replenishment of raw materials to production lines based on actual consumption. Which capability in Dynamics 365 Supply Chain Management should they use?

Accepted Answer

Kanban rules. Kanban rules in Dynamics 365 Supply Chain Management are specifically designed to automate material replenishment based on actual consumption signals (e.g., from production line scans or barcode reads). They implement a pull-based system where a kanban card triggers a replenishment event only when material is consumed, aligning directly with the requirement for consumption-driven automation.

Answer

Master planning

Answer

Quality management

Answer

Vendor collaboration

Question 18

A retailer uses Dynamics 365 Supply Chain Management to manage inventory across multiple stores. They need to ensure that store managers can only see inventory for their own store. What configuration should they use?

Accepted Answer

Data security policies. Data security policies in Dynamics 365 Supply Chain Management allow administrators to restrict record-level access based on user roles and context, such as limiting inventory visibility to a specific store. By configuring a data security policy that filters inventory records by the store dimension, store managers will only see data relevant to their assigned store. This is the correct approach because it enforces row-level security without customizing forms or reports.

Answer

Product filters

Answer

Inventory Visibility add-in

Answer

Warehouse management parameters

Question 19

A manufacturer uses Dynamics 365 Supply Chain Management and wants to implement a vendor-managed inventory (VMI) process where suppliers monitor stock levels and trigger replenishment. Which feature should they enable?

Accepted Answer

Vendor collaboration. Vendor collaboration in Dynamics 365 Supply Chain Management enables suppliers to view inventory levels, demand forecasts, and purchase orders through a dedicated portal. This allows suppliers to monitor stock and trigger replenishment, which is the core requirement of a vendor-managed inventory (VMI) process.

Answer

Purchase agreements

Answer

Intercompany orders

Answer

Consignment inventory

Question 20

A company needs to calculate the cost of manufactured products including direct materials, labor, and overhead. Which costing methodology in Dynamics 365 Supply Chain Management should they use?

Accepted Answer

Standard costing. Standard costing is the correct methodology because it allows the company to define predetermined costs for direct materials, labor, and overhead, and then calculate variances against actual costs. In Dynamics 365 Supply Chain Management, standard costing is specifically designed for manufacturing scenarios where you need to value inventory and cost of goods sold based on expected costs, with variance tracking for deviations.

Answer

Weighted average

Answer

FIFO

Answer

Moving average