Certified Supply Chain Professional (CSCP) Practice Exam

Which class in ABC classification has the greatest value?

1. A

2. B

3. C

4. D

The correct answer is: A

In ABC classification, items are categorized into three classes based on their importance, contribution to revenue, or value. The 'A' class represents the items that have the highest value and account for the largest portion of the overall value within the inventory. Typically, these items encompass a small percentage of the total number of items but contribute significantly to the total inventory value—often around 70% to 80%. The reason 'A' class items hold the greatest value is due to their critical role in revenue generation. Organizations focus on managing these items with higher levels of monitoring and control to maximize efficiency and minimize stockouts, ensuring that supply aligns well with demand. Conversely, 'B' and 'C' classes represent items of medium and lower value, respectively. Items in class 'B' usually account for a mid-level percentage of the value, while items in class 'C' are typically numerous but contribute minimally to the overall inventory value, comprising only a small fraction of total revenue. Thus, 'A' class items are indeed the most valuable in this classification system.