This MB-920 practice question tests your understanding of describe dynamics 365 supply chain management. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
Which TWO features are part of Dynamics 365 Supply Chain Management's inventory management capabilities?
Transportation management
Why wrong: Transportation management is a separate module.
Production orders
Why wrong: Production orders are part of production control.
Quality management
Quality management is an inventory management capability.
Vendor collaboration
Why wrong: Vendor collaboration is part of procurement and sourcing.
Inventory valuation
Inventory valuation is a core inventory management feature.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Quality management
Quality management (C) is a core inventory management feature in Dynamics 365 Supply Chain Management that enables tracking and controlling product quality through inspections, nonconformance handling, and quality orders. Inventory valuation (E) is also a fundamental inventory management capability, providing methods like FIFO, LIFO, and weighted average to calculate and report inventory costs accurately.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Transportation management
Why it's wrong here
Transportation management is a separate module.
Production orders
Why it's wrong here
Production orders are part of production control.
Quality management
Why this is correct
Quality management is an inventory management capability.
Related concept
Read the scenario before looking for a memorised answer.
Vendor collaboration
Why it's wrong here
Vendor collaboration is part of procurement and sourcing.
Inventory valuation
Why this is correct
Inventory valuation is a core inventory management feature.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
The trap here is that candidates confuse Transportation management and Vendor collaboration as inventory management features, when they are actually separate modules for logistics and procurement, respectively.
Detailed technical explanation
Inventory valuation in Dynamics 365 uses costing methods such as FIFO, LIFO, and weighted average, which are applied at the item level and can be configured with inventory models like standard cost or moving average. Quality management integrates with inventory to automatically generate quality orders on receipt or shipment, using item sampling and test groups to enforce compliance. These features work together to ensure inventory accuracy and regulatory adherence in real-world scenarios like pharmaceutical or food processing.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
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FAQ
Describe Dynamics 365 Supply Chain Management — This question tests Describe Dynamics 365 Supply Chain Management — Read the scenario before looking for a memorised answer..
The correct answer is: Quality management — Quality management (C) is a core inventory management feature in Dynamics 365 Supply Chain Management that enables tracking and controlling product quality through inspections, nonconformance handling, and quality orders. Inventory valuation (E) is also a fundamental inventory management capability, providing methods like FIFO, LIFO, and weighted average to calculate and report inventory costs accurately.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 24, 2026
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