Describe the core capabilities of the finance and operations apps →mediumMultiple SelectObjective-mapped
MB-920 Practice Question: Describe the core capabilities of the finance and operations apps
A company uses Dynamics 365 Supply Chain Management and wants to reduce stockouts. Which TWO strategies should they implement?
⚠ Common exam trap
It's easy for candidates to confuse ABC classification or cycle counting as stockout prevention strategies, but they are inventory management techniques for prioritization or accuracy, not direct methods to maintain inventory availability.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Reorder point
Reorder point is correct because it triggers a replenishment order when inventory falls to a predefined level, directly preventing stockouts by ensuring timely restocking. Safety stock is correct because it maintains an extra buffer of inventory above expected demand to absorb variability in supply or demand, reducing the risk of stockouts during lead time fluctuations.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Vendor managed inventory
Why it's wrong here
Vendor managed inventory shifts responsibility to supplier, but not a direct strategy.
- ✓
Reorder point
Why this is correct
Reorder point triggers replenishment when stock is low.
- ✓
Safety stock
Why this is correct
Safety stock provides a buffer against stockouts.
- ✗
ABC classification
Why it's wrong here
ABC classification prioritizes items but does not directly prevent stockouts.
- ✗
Cycle counting
Why it's wrong here
Cycle counting improves inventory accuracy, not directly prevents stockouts.
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