Courseiva

CCNA Describe Dynamics 365 Supply Chain Management Questions

24 of 324 questions · Page 5/5 · Describe Dynamics 365 Supply Chain Management · Answers revealed

Practice these questionsDomain overviewAll questions
301
Multi-Selectmedium

Which TWO features in Dynamics 365 Supply Chain Management help ensure product quality during the receiving process?

Select 2 answers
A.Item sampling
B.Location directives
C.Quality orders with inspection criteria
D.Product compliance
E.Inventory status management
AnswersA, C

Item sampling defines the percentage of items to inspect, often used with quality orders.

Why this answer

Item sampling (Option A) is correct because it allows you to define a subset of received items to be inspected, reducing the inspection workload while still ensuring quality. Quality orders with inspection criteria (Option C) are correct because they enable you to create formal quality orders that specify test types, acceptable quality levels, and inspection results, ensuring that only conforming products are accepted into inventory.

Exam trap

The trap here is that candidates may confuse inventory status management (which can block inventory after quality failure) with the proactive quality inspection process itself, leading them to select Option E instead of the correct quality order features.

Practice this question →
302
MCQmedium

A company implements Dynamics 365 Supply Chain Management. The warehouse manager reports that pickers often go to locations where inventory is reserved for outbound orders but not physically available. Which feature should be configured to prevent this issue?

A.Configure inventory status to block locations with discrepancies.
B.Set up location directives to only allow picking from locations with sufficient on-hand inventory.
C.Enable warehouse management parameters to allow negative inventory.
D.Use cycle counting to correct inventory discrepancies daily.
AnswerB

Location directives can be configured to respect on-hand inventory, preventing picking from empty locations.

Why this answer

Location directives guide pickers to the correct locations. If inventory is reserved but not physically there, the location directive may need to be configured to consider on-hand inventory. Inventory status can block locations, but the core issue is the directive not respecting actual availability.

Practice this question →
303
MCQhard

A distribution company is implementing Dynamics 365 Supply Chain Management and wants to optimize transportation costs. They have contracts with multiple carriers offering different rates based on weight, distance, and delivery speed. Which module should they use to automatically select the most cost-effective carrier for each shipment?

A.Inventory management
B.Warehouse management
C.Transportation management
D.Procurement and sourcing
AnswerC

Transportation management (TMS) uses rate engines and routing guides to automatically select the most cost-effective carrier based on shipment details.

Why this answer

Transportation management (TMS) includes rate engines and routing guides to select carriers based on defined criteria such as weight, distance, and delivery speed, thereby optimizing transportation costs. Option A (Inventory management) is wrong because it focuses on stock levels and inventory control, not carrier selection. Option B (Warehouse management) is wrong because it handles inbound and outbound warehouse operations, not transportation planning.

Option D (Procurement and sourcing) is wrong because it deals with purchasing and vendor selection, not shipping logistics.

Practice this question →
304
MCQhard

During a system audit, you discover that a warehouse worker has been able to pick inventory that was reserved for another order. Which configuration change should you recommend to prevent this issue?

A.Enable wave processing to create picks only for unreserved inventory.
B.Set up location directives to restrict picking from reserved locations.
C.Change inventory status to 'Quarantine' for reserved items.
D.Configure the inventory reservation hierarchy to enforce reservation against physical supply.
AnswerD

Reservation hierarchy ensures pickers cannot steal reserved stock.

Why this answer

Inventory reservation hierarchy determines the order of reservation against supply. If not properly configured, workers can pick reserved stock. Location directives guide picking but don't enforce reservation.

Wave processing is for batch picking. Inventory status controls availability but not reservation enforcement.

Practice this question →
305
MCQhard

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?

A.Vendor collaboration
B.Purchase agreements
C.Intercompany orders
D.Consignment inventory
AnswerA

Vendor collaboration enables suppliers to monitor inventory and create replenishment orders.

Why this answer

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.

Exam trap

The trap here is that candidates often confuse consignment inventory with vendor-managed inventory, but consignment focuses on ownership transfer at consumption, not on supplier-driven replenishment visibility.

How to eliminate wrong answers

Option B is wrong because purchase agreements are contracts that define pricing and terms for future purchases, but they do not provide suppliers with visibility into inventory levels or the ability to trigger replenishment. Option C is wrong because intercompany orders are used for transactions between legal entities within the same organization, not for external suppliers managing inventory. Option D is wrong because consignment inventory is a model where the supplier owns stock at the customer's location until it is consumed, but it does not inherently include the supplier's ability to monitor and trigger replenishment; that requires vendor collaboration.

Practice this question →
306
Multi-Selectmedium

Which TWO features in Dynamics 365 Supply Chain Management can be used to manage inventory accuracy?

Select 2 answers
A.Wave templates
B.Location directives
C.Transportation management
D.Inventory blocking
E.Cycle counting
AnswersD, E

Inventory blocking prevents use of inaccurate or damaged stock.

Why this answer

Inventory blocking (Option D) is correct because it allows users to physically or financially block inventory that is damaged, on hold for quality inspection, or reserved for a specific purpose, preventing it from being picked or shipped. This directly maintains inventory accuracy by ensuring that only available, unblocked stock is counted in available quantities. Cycle counting (Option E) is correct because it is a perpetual inventory audit method where a subset of items is counted on a recurring schedule, enabling continuous validation of on-hand quantities against system records without requiring a full physical inventory shutdown.

Exam trap

The trap here is that candidates confuse operational features like wave templates and location directives (which manage warehouse execution) with inventory accuracy features, when the exam specifically tests knowledge of tools that directly validate or protect the integrity of on-hand stock records.

Practice this question →
307
MCQhard

A global manufacturer uses Dynamics 365 Supply Chain Management. They need to configure a product that is manufactured in multiple variants based on size and color, with each variant having its own bill of materials (BOM). Which product configuration approach should they use?

A.Product master with predefined variants
B.Single product with multiple BOM versions
C.Product master with constraint-based configuration
D.Catch weight product
AnswerA

Predefined variants allow different BOMs per variant.

Why this answer

A product master with predefined variants allows each variant to have its own bill of materials (BOM), which is exactly what is needed for products manufactured in multiple variants based on size and color. Option B is incorrect because a single product with multiple BOM versions is used for different production dates or processes, not for managing different product variants. Option C is incorrect because constraint-based configuration is intended for highly configurable products with many options and rules, not for simple predefined variants.

Option D is incorrect because catch weight products are used for items that are measured by weight, not for variant configuration.

Practice this question →
308
MCQeasy

A company uses Dynamics 365 Supply Chain Management. They need to track the carbon footprint of their products throughout the supply chain. Which module should they use?

A.Product information management
B.Sustainability Manager
C.Asset management
D.Inventory management
AnswerB

Sustainability Manager tracks carbon emissions across the supply chain.

Why this answer

Sustainability Manager is the correct module because it is specifically designed to help organizations measure, track, and reduce their carbon footprint and other environmental impacts across operations and supply chains. It integrates with Dynamics 365 Supply Chain Management to capture emissions data from procurement, production, and logistics activities, enabling end-to-end carbon accounting.

Exam trap

The trap here is that candidates may confuse the general functionality of Inventory or Product information management with the specialized sustainability capabilities, not realizing that Microsoft created a dedicated Sustainability Manager module specifically for carbon tracking and environmental reporting.

How to eliminate wrong answers

Option A is wrong because Product information management handles product master data, bills of materials, and product lifecycle management, but it does not include any carbon tracking or sustainability analytics. Option C is wrong because Asset management focuses on maintaining and servicing physical assets like equipment and machinery, not on environmental footprint measurement. Option D is wrong because Inventory management tracks stock levels, movements, and warehouse operations, but it lacks the specialized emissions calculation and reporting capabilities required for carbon footprint tracking.

Practice this question →
309
Multi-Selecteasy

Which TWO are examples of production order statuses in Dynamics 365 Supply Chain Management?

Select 2 answers
A.Reserved
B.Released
C.Picked
D.Reported as finished
E.Invoiced
AnswersB, D

Released is a production order status indicating it is ready for execution.

Why this answer

In Dynamics 365 Supply Chain Management, production order statuses track the lifecycle of a manufacturing order. 'Released' (B) is a valid status that indicates the production order has been authorized for execution on the shop floor. 'Reported as finished' (D) is also a valid status, meaning the entire quantity or a partial quantity of the production order has been completed and reported into inventory.

Exam trap

The trap here is that candidates confuse inventory or warehouse transaction statuses (like Reserved or Picked) with the specific lifecycle statuses of a production order, which are defined in the production control module.

Practice this question →
310
MCQeasy

A distributor wants to ensure that when a sales order is created, the system automatically checks if the requested item is available in the warehouse. If the item is out of stock, the system should create a purchase order for the item. Which feature in Dynamics 365 Supply Chain Management supports this?

A.Inventory management
B.Order promising
C.Production control
D.Procurement and sourcing
AnswerA

Correct. Inventory management includes replenishment strategies (min/max, reorder point) that automatically create purchase orders when inventory is low.

Why this answer

(Inventory management) is correct because it includes replenishment features such as min/max and reorder point inventory planning that automatically generate purchase orders when stock levels fall below a threshold. Option B (Order promising) is incorrect because it calculates availability-to-promise (ATP) and capable-to-promise (CTP) dates but does not automatically create purchase orders. Option C (Production control) is incorrect as it manages manufacturing orders, not purchasing.

Option D (Procurement and sourcing) is incorrect because although it handles purchase order processing, the automatic triggering is done by inventory management replenishment.

Practice this question →
311
MCQeasy

A company uses Dynamics 365 Supply Chain Management and needs to track the cost of raw materials as they move through production. The company uses standard cost methodology. Which module should be used to view the cost breakdown of a finished good?

A.Product information management
B.Cost management
C.Production control
D.Inventory management
AnswerB

Cost management provides BOM calculations and cost roll-up for finished goods.

Why this answer

Cost management provides cost analysis, including BOM calculations and cost breakdowns. Option A is wrong because Product information management maintains product data but not cost details. Option C is wrong because Production control manages production orders, not cost breakdowns.

Option D is wrong because Inventory management tracks quantities, not costs.

Practice this question →
312
Multi-Selecteasy

A company uses Dynamics 365 Supply Chain Management to manage its supply chain. They need to configure settings for transportation management. Which TWO parameters are typically defined?

Select 2 answers
A.Rate masters
B.Shipping carriers
C.Production routes
D.Warehouse locations
E.Vendor catalogs
AnswersA, B

Transportation management parameter.

Why this answer

Options A and B are correct because shipping carriers and rate masters are core transportation management parameters. Option C is incorrect because production routes are manufacturing. Option D is incorrect because warehouse setups are warehouse management.

Option E is incorrect because vendor catalogs are procurement.

Practice this question →
313
MCQhard

A company uses Dynamics 365 Supply Chain Management with advanced warehouse management. Workers are reporting that pick lines are being created with incorrect locations, causing delays. What could be the root cause?

A.Mobile device menu items are set up incorrectly.
B.Wave templates are not assigned to the correct warehouse.
C.Location directives are incorrectly configured.
D.Work templates have the wrong work class.
AnswerC

Location directives control which locations are used for picking.

Why this answer

Location directives determine the specific pick locations for work orders based on criteria such as inventory location, zone, and sequence. If misconfigured, incorrect locations are assigned, causing delays. Option A is incorrect because mobile device menu items affect the user interface and scanning, not the location logic.

Option B is incorrect because wave templates group work and create waves but do not assign specific locations. Option D is incorrect because work templates define the structure of work (e.g., which lines form pick and put) but not the actual locations.

Practice this question →
314
MCQhard

A distribution company uses Dynamics 365 Supply Chain Management. They notice that the cost of goods sold (COGS) is being incorrectly calculated for certain items. The items are set up with a costing method of 'FIFO' and the inventory model is 'FIFO with physical value'. The issue occurs when purchase orders are received but not yet invoiced. What is the most likely cause of the incorrect COGS calculation?

A.The inventory close process has not been run
B.The costing method should be 'Standard cost'
C.The physical receipt cost differs from the final invoice cost
D.The inventory model should be 'FIFO with financial value'
AnswerC

In FIFO with physical value, COGS is based on physical receipt cost until invoiced, which can cause incorrect COGS if the receipt cost is inaccurate.

Why this answer

In a FIFO costing method with 'FIFO with physical value' model, COGS is calculated based on the physical receipt cost until the invoice is posted. If the physical receipt cost differs from the final invoice cost, the COGS will be temporarily incorrect until the invoice is updated. Option A is incorrect because running inventory close would correct costs after invoicing, but the issue here is a timing difference before invoicing.

Option B is incorrect because standard cost is a different costing method not related to the FIFO setup. Option D is incorrect because 'FIFO with financial value' would change when costs are updated, but the current model 'FIFO with physical value' is appropriate for the described behavior.

Practice this question →
315
Multi-Selecteasy

Which TWO are valid warehouse management processes in Dynamics 365 Supply Chain Management?

Select 2 answers
A.Purchase order creation
B.Production scheduling
C.Receiving and putaway
D.Invoice matching
E.Picking and shipping
AnswersC, E

Receiving and putaway are fundamental warehouse processes.

Why this answer

Receiving and putaway are core warehouse management processes in Dynamics 365 Supply Chain Management. The system uses mobile device menus and warehouse location directives to guide workers through receiving inventory and placing it into storage locations, leveraging license plate tracking and inventory status updates.

Exam trap

The trap here is that candidates confuse general supply chain processes (like purchase orders or production scheduling) with the specific warehouse execution processes that are managed within the Warehouse Management module.

Practice this question →
316
Multi-Selectmedium

A company uses Dynamics 365 Supply Chain Management and wants to use Copilot to assist with supply chain planning. Which THREE capabilities are provided by Copilot in Supply Chain Management?

Select 3 answers
A.Explain master planning results in natural language
B.Generate purchase orders automatically
C.Predict potential supplier delays
D.Automatically adjust inventory levels using AI
E.Suggest alternative suppliers based on historical performance
AnswersA, C, E

Copilot can provide explanations of planning outputs.

Why this answer

Options A, C, and E are correct. Copilot in Supply Chain Management can explain master planning results in natural language (A), predict potential supplier delays (C), and suggest alternative suppliers based on historical performance (E). Option B (generate purchase orders automatically) is not a Copilot capability but a standard automation feature.

Option D (automatically adjust inventory levels using AI) is related to inventory optimization, not Copilot.

Practice this question →
317
MCQhard

Refer to the exhibit. A warehouse manager runs the on-hand inventory report for item P-1000 in warehouse WH01. The report shows zero on-hand quantity but the inventory status is 'Available'. The manager knows that there should be 500 units in stock based on a recent purchase order receipt. What is the most likely cause of this discrepancy?

A.The purchase order receipt has not been registered in the warehouse
B.The item is stored in a different location
C.The item is reserved for a sales order
D.The item is on a quality order
AnswerA

Without registration, on-hand quantity is not updated; status remains 'Available' from earlier setup.

Why this answer

The most likely cause is that the purchase order receipt has not been registered in the warehouse (Option A). In Dynamics 365 Supply Chain Management, inventory status is set to 'Available' by default when an item is created or received, but the on-hand quantity only updates after the receipt is physically registered against the warehouse. Since the manager sees zero on-hand quantity despite knowing 500 units were received, the receipt transaction likely exists in the system but hasn't been posted to the warehouse inventory, leaving the quantity unrecorded.

Exam trap

The trap here is that candidates confuse the 'Available' inventory status with actual on-hand quantity, assuming 'Available' implies stock exists, when in Dynamics 365 'Available' is a default status that can be assigned even with zero quantity until a warehouse registration is completed.

How to eliminate wrong answers

Option B is wrong because storing the item in a different location would still show the on-hand quantity in the warehouse (WH01) if the receipt was registered; the location is a sub-level of the warehouse, not a separate inventory bucket. Option C is wrong because reserving for a sales order reduces available quantity but does not zero out the on-hand quantity; the on-hand would still show 500, with a reserved quantity subtracted from available. Option D is wrong because placing the item on a quality order changes its inventory status to 'Quarantine' or similar, not 'Available', and the on-hand quantity would still reflect the units in the quality order.

Practice this question →
318
Multi-Selectmedium

Which TWO benefits does the Asset management module in Dynamics 365 Supply Chain Management provide?

Select 2 answers
A.Automated warranty claims processing
B.Vendor performance analysis
C.Preventive maintenance scheduling
D.Demand forecasting
E.Maintenance history tracking
AnswersC, E

Asset management supports preventive maintenance scheduling.

Why this answer

Options C and E are correct. Preventive maintenance scheduling (C) allows organizations to plan and perform maintenance based on time or usage intervals, reducing unplanned downtime. Maintenance history tracking (E) provides a complete record of all maintenance activities, costs, and parts used, enabling better asset lifecycle management.

Option A is incorrect because automated warranty claims processing is not a feature of the Asset management module; warranty management is handled elsewhere. Option B is incorrect because vendor performance analysis is part of Procurement or Vendor management, not Asset management. Option D is incorrect because demand forecasting is part of Master planning or Demand forecasting modules.

Practice this question →
319
MCQeasy

A distribution company needs to automate the generation of purchase orders when inventory levels fall below a predefined threshold. Which feature in Dynamics 365 Supply Chain Management should be configured?

A.Inventory visibility
B.Vendor collaboration
C.Replenishment rules
D.Batch balancing
AnswerC

Replenishment rules automatically generate purchase orders based on inventory levels.

Why this answer

Replenishment rules automatically generate purchase orders based on inventory levels. Option A is wrong because inventory visibility is a monitoring tool, not for automation. Option B is wrong because vendor collaboration is for communication with vendors, not for automatic PO generation.

Option D is wrong because batch balancing is used in production to balance load, not for purchase order generation.

Practice this question →
320
MCQeasy

A logistics manager wants to optimize delivery routes to reduce transportation costs. Which module in Dynamics 365 Supply Chain Management should they use?

A.Transportation management
B.Procurement and sourcing
C.Warehouse management
D.Production control
AnswerA

Handles routing and freight.

Why this answer

Transportation management handles routing and freight optimization. Option B is incorrect because Procurement and sourcing is for purchasing. Option C is incorrect because Warehouse management is for warehousing.

Option D is incorrect because Production control is for manufacturing.

Practice this question →
321
MCQeasy

A manufacturer uses Dynamics 365 Supply Chain Management to manage production orders. They want to ensure that raw materials are automatically reserved and picked when a production order is released. Which parameter should be set on the production order or in the system?

A.Route version
B.Production order status
C.Reservation hierarchy
D.BOM version
AnswerB

Setting the production order status to 'Released' triggers automatic reservation and picking when the system's automatic reservation setting is enabled.

Why this answer

Releasing a production order changes its status to 'Released'. The automatic reservation and picking of raw materials upon release is controlled by the 'Automatic reservation' parameter, typically set in the coverage group or production order defaults. None of the listed options (Route version, Production order status, Reservation hierarchy, BOM version) correspond to this parameter.

Practice this question →
322
Multi-Selecthard

Which THREE capabilities are provided by the Warehouse management module in Dynamics 365 Supply Chain Management?

Select 3 answers
A.Wave processing
B.Vendor collaboration portal
C.Route planning for outbound shipments
D.Mobile device menu items
E.Location directives
AnswersA, D, E

Wave processing is a core warehouse management feature.

Why this answer

Wave processing is a core warehouse management capability. Option D is correct because mobile device menu items enable warehouse workers to perform tasks. Option E is correct because location directives guide put-away and picking.

Option B is incorrect because vendor collaboration portal is a procurement feature, not part of warehouse management. Option C is incorrect because route planning for outbound shipments belongs to Transportation management, not warehouse management.

Practice this question →
323
MCQeasy

Refer to the exhibit. A production order is in 'Estimated' status. The production scheduler needs to generate material requirements for the order. What should they do next?

A.Post the picking list.
B.Start the production order.
C.Release the production order.
D.Schedule the production order.
AnswerD

Scheduling generates material requirements and sets the order status to 'Scheduled'.

Why this answer

A production order in 'Estimated' status has not yet been scheduled. Scheduling the order (operations or job scheduling) will generate material requirements and update the status. Releasing the order would require scheduling first.

Estimating is already done.

Practice this question →
324
Multi-Selecthard

Which THREE of the following are valid warehouse management processes in Dynamics 365 Supply Chain Management?

Select 3 answers
A.Shipping
B.Budgeting
C.Picking
D.Receiving
E.Invoicing
AnswersA, C, D

Shipping is a key warehouse process.

Why this answer

Options A, C, and D are correct: Receiving, Picking, and Shipping are core warehouse processes. Option B is incorrect because Budgeting is a financial process, not a warehouse management process. Option E is incorrect because Invoicing is part of Accounts receivable, which is also a financial process.

Practice this question →
← PreviousPage 5 of 5 · 324 questions total

Ready to test yourself?

Try a timed practice session using only Describe Dynamics 365 Supply Chain Management questions.

Start 20-question session