CPIM Practice Exam

What is the purpose of a bonded warehouse?

1. To store goods that are being taxed at a lower rate.

2. For storing imported merchandise under US Customs supervision.

3. For storing hazardous materials safely and securely.

4. To manage retail inventory before distribution.

The correct answer is: For storing imported merchandise under US Customs supervision.

The purpose of a bonded warehouse is specifically to store imported merchandise under the supervision of US Customs. This type of facility allows goods to be kept without the payment of customs duties until they are either removed from the warehouse for sale in the domestic market or exported outside the country. By utilizing a bonded warehouse, importers can defer the payment of tariffs, which can provide financial flexibility and can help manage cash flow. This arrangement also ensures compliance with regulations while safeguarding goods until they are ready for distribution or sale. The other options, while they involve storage or inventory management, do not accurately capture the distinct function of a bonded warehouse. Storing goods taxed at a lower rate does not precisely describe the customs oversight involved; hazardous materials require different types of facilities designed specifically for safety and compliance; and managing retail inventory pertains to distribution and sales, which is outside the specialized nature of a bonded warehouse's operations.