Describe the core capabilities of the finance and operations apps →hardMultiple ChoiceObjective-mapped
MB-920 Practice Question: Describe the core capabilities of the finance and operations apps
A company uses Dynamics 365 Supply Chain Management. They want to enable a vendor to manage their own inventory at the customer's site (consignment inventory). What process should they set up?
⚠ Common exam trap
Many candidates confuse 'vendor collaboration' (a communication feature) with the actual consignment inventory process, or they mistakenly think a drop shipment or transfer order can achieve the same vendor-managed inventory at the customer site.
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
✓
Consignment inventory
Consignment inventory in Dynamics 365 Supply Chain Management allows a vendor to own stock that is physically located at the customer's site. The customer only pays for the inventory when it is consumed or transferred to their ownership. Setting up the consignment inventory process enables the vendor to manage replenishment and visibility of their stock at the customer location through vendor collaboration features.
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 collaboration
Why it's wrong here
Vendor collaboration allows vendors to view orders, not manage consignment.
- ✗
Purchase order with drop shipment
Why it's wrong here
Drop shipment is direct delivery, not consignment.
- ✓
Consignment inventory
Why this is correct
Consignment inventory allows vendor-owned stock at customer site.
- ✗
Transfer order
Why it's wrong here
Transfer orders move own inventory, not vendor-owned.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This MB-920 practice question is part of Courseiva's free Microsoft certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the MB-920 exam.