Free ISM CORE Exam Questions

An organization is preparing its budget for the next fiscal year. Management challenges the procurement teamto reduce MRO purchasing costs. The procurement team has reduced the janitorial services budget by 2.5%, but corporate management wants a 5% reduction. Which of the following is the BEST approach for the team to take in order to meet management's expectation?

Which of the following is the MOST important reason for supply management to share company business plans with current and prospective suppliers?

A machining company outsources its recycling program to a third party. The third party recycles the metals from the production area, but neglects to recycle the aluminum cans from the break room, as this stipulation was not included in the service-level agreement. This situation is MOST likely a result of the supply manager's failure to have an appropriate

A company creates a corporate sourcing team with category management responsibilities. Previously, the firm had no dedicated sourcing staff, and all procurement was decentralized and transactional. The sourcing team is ready to commence its initial project. Which of the following should the team do FIRST?

A firm enters into a contract with a minority business. The invoice does not match the purchase order, and some incorrect items are shipped. The erroneous items, valued at $5,000, are returned. The replacement items are scheduled to be delivered within 2 days. The total invoice is for $18,000, which is a substantial amount for the business. Preferential payment terms have previously been negotiated from 30 to 14 days from receipt of goods, as cash flow is a significant issue. The situation is summarized as follows: Purchase Order RaisedGoods Received Invoiced Timing18 days ago 13 days ago 12 days ago Amount$18,000 $18,000 $18,000 As it will take one business day to process payment, a decision needs to be made on whether the supplier should receive payment on time. Which of the following courses of action should the supply manager take?