Your organization has lot controlled and nonlot controlled material and stores all defective material in a subinventory called "Defect". The organization does not want defective material to be…

Question

Options

• ATag the lot as defective product.
• BDisallow all inventory transactions for the subinventory "Defect".
• CPut a hold on the lot.
• DAssign the subinventory a material status that disallows reservations and allows subinventory
• EAssign the lot a material status that disallows reservations and allows subinventory transfers and

• B
  4% (1)
• C
  4% (1)
• D
  92% (24)

Explanation

Option D is correct because the organization has both lot controlled and non-lot controlled material in the "Defect" subinventory. Assigning a material status at the subinventory level covers all items regardless of lot control, preventing reservations and customer shipments while still permitting internal transfers (e.g., for rework or disposal). It's the only solution that addresses the full scope of the requirement in a single action.

Why the distractors fail:

• A & C (tag/hold the lot): These only affect lot-controlled material; non-lot controlled items are left unprotected, making them incomplete solutions.
• B (disallow all transactions): This overcorrects - blocking every transaction would prevent even legitimate internal moves like transferring material to a scrap or rework location, paralyzing operations.
• E (material status on the lot): Same flaw as A and C - lot-level statuses don't apply to non-lot controlled material, so half the inventory remains unguarded.

Memory tip: Think of it this way - the "Defect" subinventory is like a quarantine room. You want the room (subinventory) locked to outsiders (reservations/shipping), not just some of the items inside it. A subinventory-level material status locks the whole room, while lot-level actions only lock specific labeled boxes.

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