Deck 18: Material Requirements Planning

Question 1

The deeper one looks into the product creation sequence,the more the requirements of dependent demand items tend to smooth out and become even over time.

Answer 1

False

Question 2

Management defines time fences as periods of time having some specific Level of opportunity for the customer to make changes.

Answer 2

True

Question 3

A master production schedule is an essential input to a material requirements planning (MRP)system.

Answer 3

True

Question 4

The master production schedule (MPS)is a time-phased plan specifying how many of each end item to build and when the firm plans to build them.

Question 5

Use of time fences maintains a reasonably controlled flow through a production system.

Question 6

MRP is most valuable in industries where a number of products are made in batches using the same productive equipment.

Question 7

MRP provides the schedule specifying when each part and component of an end item should be ordered or produced.

Question 8

All firms maintain bill of materials (BOM)files,which are simply a sequencing of everything that goes into a final product.

Question 9

MRP is a logical,easily understandable approach to the problem of determining the number of parts,components and materials needed to produce each end item.

Question 10

A time fence is a unit of productivity related to time.

Question 11

MRP is least valuable in industries where a number of products are made in batches using the same productive equipment.

Question 12

A necessary input to the material requirements planning (MRP)system is an exception report.

Question 13

MRP is based on dependent demand.

Question 14

MRP stands for Manufacturing Requirements Planning.

Question 15

Developing the master production schedule is done by disaggregating the aggregate production plan.

Question 16

Time fences increase productivity by reducing the time spent waiting for each product to be produced.

Question 17

MRP II stands for Manufacturing Resource Planning.

Question 18

The deeper one looks into the product creation sequence,the more the requirements of dependent demand items tend to become "lumpy".

Question 19

The master production schedule states the number of items to be produced during specific time periods.

Question 20

A necessary input to the material requirements planning (MRP)system is an inventory records file.

Question 21

A BOM file is often called a product structure file or product tree because it enumerates all of the component parts of the end item product.

Question 22

One of the biggest complaints by users of MRP systems is that MRP is too flexible in making changes in schedules when the need arises.

Question 23

In today's modern world of rapid computing and just-in-time replenishment of supplies,freezing the master production schedule is unnecessary.

Question 24

A modular bill of materials includes items with fractional options.

Question 25

To implement a MRP system successfully,a high degree of inventory and bill-of-material accuracy is required.This may involve significant change in how a firm operates.

Question 26

Computing the quantity of each component that goes into a finished product requires expanding (or exploding)each item in a product structure file and summing at all Levels.

Question 27

In a net change MRP system requirements and schedules are considered rigid and never updated.

Question 28

In a net change MRP system requirements and schedules are updated whenever a transaction is processed that has an impact on the item.

Question 29

Low Level coding in MRP indicates the exact status of each item managed by the system in "real time".

Question 30

Net change MRP systems are "activity" driven.

Question 31

An MRP program with a capacity requirements planning module allows rescheduling to try to Level capacity.

Question 32

One of the outputs of an MRP system is a bill of materials (BOM)file.

Question 33

A modular bill of materials is the term for an item that can be produced and stocked as a subassembly.

Question 34

The MRP program performs its analysis from the bottom of the product structure trees up,imploding requirements Level by Level.

Question 35

Computing the quantities of each component that goes into a finished product requires expanding (or exploding)each item in a product structure file and summing at all Levels.

Question 36

If you cannot provide a master production schedule (MPS)as an input file,you cannot run a material requirements planning (MRP)system.

Question 37

The philosophy of material requirements planning is that materials should be expedited when their lack would delay the overall production schedule and de-expedited when the schedule falls behind and postpones their need.

Question 38

The "theme" of MRP is getting the right materials to the right place before they are needed.

Question 39

Net change MRP reflects the exact status of each item managed by the system in "real time".
Goal: 3

Question 40

In a net change MRP program,a change in one item will result in a completely new inventory plan and schedule for every item in the master production schedule.

Question 41

Projected available balance is the amount of inventory that is expected as of the beginning of a period.

Question 42

A BOM file is sometimes called which of the following?

A)Product structure tree
B)Stocking plan
C)Inventory usage record
D)Production parts plan
E)Time bucket schedule

Question 43

The economic order quantity (EOQ)lot sizing technique produces or acquires exactly the amount of product that is needed each time period with none carried over into future periods.

Question 44

The lot-for-lot (L4L)lot sizing technique minimizes carrying cost by taking into account setup costs and capacity limitations.

Question 45

The three main inputs to an MRP system are the bill of materials,the master schedule and the inventory records file.

Question 46

A material requirements planning (MRP)system with information feedback from its module outputs is termed a "closed-loop MRP" system.

Question 47

The least total cost method (LTC)lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering)costs for various lot sizes and then selects the lot in which these are most nearly equal.

Question 48

"Available to promise" is a term referring to unsold finished goods inventory.

Question 49

The least unit cost method (LUC)of lot-sizing technique adds ordering,stock-out and inventory carrying cost for each trial lot size and divides by the number of units in each lot size,picking the lot size with the lowest unit cost.

Question 50

Which of the following industry types will not benefit greatly from the application of MRP?

A)Fabricate-to-order
B)Assemble-to-stock
C)Assemble-to-order
D)Manufacture-to-order
E)None of the above

Question 51

Lot-for-lot (L4L)is the most common lot sizing technique.

Question 52

Which of the following industry types have high expected benefits from the application of MRP?

A)Fabricate-to-stock
B)Fabricate-to-order
C)Assemble-to-stock
D)Continuous process
E)Service and repair parts

Question 53

A lot-for-lot (L4L)lot sizing technique does not take into account setup costs or capacity limitations.

Question 54

Since MRP systems focus on batch or lot-sized orders and JIT is focused on individual item production,the two systems are incompatible and cannot work together.

Question 55

The difference between the number of units currently included in the master schedule and the number of units in firm customer orders is often called "available to promise".

Question 56

"Projected available balance" is a term referring to unsold finished goods inventory.

Question 57

The economic order quantity (EOQ)lot sizing technique uses the "square root formula" to balance set-up cost,carrying cost and cost of stock-outs.

Question 58

The least unit cost method (LUC)of lot-sizing technique adds ordering and inventory carrying cost for each trial lot size and divides by the number of units in each lot size,picking the lot size with the lowest unit cost.

Question 59

Generally,determining lot sizes in MRP systems is simple.

Question 60

The least unit cost method (LUC)lot-sizing technique calculates the order quantity by comparing the carrying cost and the setup (or ordering)costs for various lot sizes and then selects the lot in which these are most nearly equal.

Question 61

An improvement noted by many firms after implementation of MRP is which of the following?

A)Increased idle time
B)Quicker setup times
C)Inability to change the master schedule
D)Reduced inventory
E)Improved product design-for-manufacture

Question 62

To ensure good master scheduling,the master scheduler should do which of the following?

A)Continually rework the aggregate plan
B)Be involved with customer order promising
C)Be invisible to management
D)Cover-up all problems
E)Focus on getting out product before it is needed

Question 63

Which of the following is not a production activity report generated by MRP?

A)Exception report
B)Planning report
C)Performance control report
D)Planned-order schedules
E)Bill of materials report

Question 64

One of the main purposes of a MRP system is which of the following?

A)Track inventory Levels
B)Create productive capacity
C)Decrease layers of management
D)Develop schedules for when each component should be produced
E)Upgrade manufacturing's professionalism

Question 65

Which of the following is an input to the master production schedule?

A)Prototype products from product development
B)Aggregate component schedule
C)Peg records
D)Exception reports
E)Forecasts of demand from random customers

Question 66

MRP systems seek to achieve which of the following?

A)Minimize lot sizes
B)Determine the number of dependent demand items needed
C)Give immediate capacity relief
D)Provide a yardstick for future improvements
E)Improve on JIT methods

Question 67

Which of the following industry types have high expected benefits from the application of MRP?

A)Fabricate-to-order
B)Hospitals
C)Assemble-to-order
D)Aircraft manufacturers
E)Oil refineries

Question 68

An improvement noted by many firms after implementation of MRP is which of the following?

A)Increased prices
B)Increased inventory
C)Improved customer service
D)Reduced raw materials cost
E)Enhanced employee relations

Question 69

Which of the following is a capability of MRP systems that improves operations planning and control?

A)MRP indicates when to de-expedite as well as expedite orders
B)MRP systems consume many reams of paper thereby justifying quantity purchases
C)Once entered;a production order can't be changed,enforcing discipline on sales
D)MRP can anticipate returns of defective product
E)MRP allows manufacturing to operate in a pure,isolated environment

Question 70

Which of the following is an input to the master production schedule?

A)Bill of materials (BOM)file
B)Inventory records file
C)Exception reports
D)Planned-order schedules
E)None of the above

Question 71

Objectives of inventory management under an MRP system include which of the following?

A)Improve customer service
B)Reduce the cost of capital
C)Calibrate operating efficiencies
D)Minimize lot sizes
E)Reduce inventory to zero

Question 72

Which of the following is a time fence operating mode?

A)Frozen
B)Moderately soft
C)Inflexible
D)Delayed
E)Quality control hold

Question 73

Which of the following is an input to the master production schedule (MPS)?

A)Inventory records file
B)The aggregate plan
C)The bill of materials
D)The exception report
E)Planned order schedules

Question 74

Which of the following is one of the main purposes of a MRP system?

A)Educate personnel in basic work rules
B)To determine time schedules for material procurement
C)Stimulate the work force
D)Decrease labor requirements
E)Increase inventory accuracy

Question 75

In an MRP program,the program accesses the status of any file in specific periods called which of the following?

A)Cubed time units
B)Time buckets
C)BOM units
D)Modular time units
E)Time fences

Question 76

Which of the following is most closely related to the reason a firm might implement MRP?

A)So they can order the right parts
B)So they can order parts sufficient for immediate use
C)So they can insure that parts to arrive prior to when they are needed
D)To assure appropriate quality Levels
E)To keep process costs between the LCL and the UCL

Question 77

Which of the following is an input file necessary to run an MRP system?

A)Bill of materials (BOM)file
B)Quality management report
C)Exception reports
D)Planned-order schedules
E)Purchasing contracts

Question 78

A product structure tree can do which of the following?

A)Help to compute component usage
B)Reduce product scrap
C)Reduce labor overtime
D)Reduce regular time labor
E)Locate raw material supplies

Question 79

Which of the following is a major reason that some MRP systems fail?

A)Lack of top management understanding and commitment
B)Failure to properly install the MRP software
C)Using an underpowered computer
D)Technical incompetence in manufacturing
E)Vendors or customers using JIT systems

Question 80

Which of the following is an input file necessary to run an MRP system?

A)Exception report
B)Computer-aided-design files
C)Inventory records file
D)Personnel files
E)Time fence file