MB-920 Inventory management Practice Question
A manufacturing company wants to track the cost of raw materials from purchase to finished goods. Which module in Dynamics 365 Finance should they primarily use?
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
✓
Inventory management
Inventory management is the primary module for tracking raw material costs from purchase through production to finished goods. It integrates with production control to calculate actual costs. Accounts payable handles vendor invoices, not cost tracking. Budgeting is for financial planning, not operational cost tracking. General ledger provides high-level financial reporting, not detailed cost tracking.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
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Accounts payable
Why it's wrong here
Accounts payable manages vendor invoices and payments, but does not track the cost of raw materials through production.
- ✓
Inventory management
Why this is correct
Inventory management is the correct module as it handles cost tracking of raw materials from purchase to finished goods, including costing methods like FIFO, LIFO, and standard costing.
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Budgeting
Why it's wrong here
Budgeting is used for financial planning and forecasting, not for tracking actual costs of materials.
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General ledger
Why it's wrong here
General ledger provides financial reporting and account balances, but inventory cost tracking is done at a more granular level in the Inventory management module.
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