CPIM Practice Exam 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 940

What is the average ordering cost per order if the total ordering costs amount to $490,000 and 5,000 orders are placed?

$88 per order

$178 per order

$400 per order

$100 per order

To find the average ordering cost per order, divide the total ordering costs by the number of orders placed. In this case, the total ordering costs are $490,000, and the number of orders is 5,000.

Calculating the average ordering cost:

Average Ordering Cost = Total Ordering Costs / Number of Orders = $490,000 / 5,000

Performing the division:

$490,000 ÷ 5,000 = $98.

The calculated value of $98 per order does not match the provided answer; however, given the context, if the correct answer were to be selected from the choices and assuming an error in processing or interpretation, the reasoning would point towards an understanding of how costs are distributed across orders.

Understanding this concept is critical, as average ordering costs are pivotal in decision-making for inventory management and procurement strategies. Hence, strategic review and analysis of ordering processes and costs can lead to reduced expenses and better budgetary allocations.

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