Question 1

Capacity requirements planning helps managers reconcile __________ with __________.

Accepted Answer

Capacity requirements planning helps managers reconcile what is needed (demand for goods/services) with what is possible (available resources, production capacity, etc.).

Question 2

Backflushing takes place:

Accepted Answer

Backflushing is a method used to automatically update inventory records and costs after production is completed, based on the bill of materials for the finished goods.

Question 3

Capacity requirements planning is an important feature in MRP.

Accepted Answer

The answer of Capacity requirements planning is an important feature...

Question 4

ERP began in manufacturing organizations but has spread into service organizations.

Accepted Answer

ERP (Enterprise Resource Planning) systems started in manufacturing organizations to manage and optimize their production processes. However, over time, the benefits of ERP have become apparent to service organizations as well, and many have implemented ERP to manage their financials, supply chain, customer relationship management, and other key business functions.

Question 5

Scheduled receipts differ from planned receipts in that scheduled receipts:

Accepted Answer

Scheduled receipts involve orders that have already been placed, while planned receipts involve orders that have not yet been placed.

Question 6

In many organizations, information flows much more freely within functions than it does across functions. __________ represents an expanded effort to overcome this tendency.

Accepted Answer

ERP (Enterprise Resource Planning) is a software solution designed to integrate all aspects of a business, including finance, human resources, supply chain management, and customer relationship management. By bringing data and processes from different functions together, ERP can help break down barriers to communication and improve information sharing across the organization. MRP, MRPII, CRP, and DRP are all more focused on specific aspects of operations or supply chain management rather than overall organizational communication.

Question 7

In MRP, EOQ models tend to be less useful for materials at the lowest levels than for upper-level assemblies of the bill of materials since higher-level assemblies have larger dollar investments.

Accepted Answer

The answer of In MRP, EOQ models tend to be...

Question 8

Which of the following is absolutely necessary for successful implementation and operation of MRP?
(I) accurate inventory records
(II) master schedules
(III) accurate holding and backordering costs
(IV) accurate bills of materials

Accepted Answer

Accurate inventory records, master schedules, and accurate bills of materials are essential for MRP to function effectively, as they ensure that the system can accurately plan and schedule production. Accurate holding and backordering costs are not directly necessary for MRP operation.

Question 9

Load reports show capacity requirements for departments or work centers which may be more or less than the capacity available in that work center.

Accepted Answer

Load reports help to identify the capacity requirements for each department or work center, but it is not uncommon for these requirements to exceed or fall short of the available capacity.

Question 10

Which of the following is a direct input into capacity requirements planning?
(I) the master production schedule
(II) routing information
(III) current shop loads
(IV) planned-order releases

Accepted Answer

The answer of Which of the following is a direct...

Question 11

MRP can apply to services, especially when it is focused on:
(I) work-in-process inventory.
(II) finished goods inventory.
(III) service components.
(IV) materials that are part of the service process.

Accepted Answer

MRP can apply to services when it is focused on service components and materials that are part of the service process, but not necessarily work-in-process or finished goods inventory. Therefore, the best choice is III and IV only, which is option E.

Question 12

One reason that accurate bills of material are important is that errors at one level become magnified at lower levels because of the multiplication process used by MRP.

Accepted Answer

This statement is true. MRP (material requirements planning) uses the bill of materials to determine the quantity of components needed to produce a finished product. Any errors in the bill of materials can lead to inaccurate materials planning and production scheduling, which can then cause problems downstream in the manufacturing process. As MRP multiplies these errors through the production process, the impact of the errors can become much greater at lower levels of the bill of materials. Therefore, it's important to ensure that bills of materials are accurate and up-to-date to ensure the smooth functioning of the manufacturing process.

Question 13

One of the primary output reports of MRP concerns changes to planned orders.

Accepted Answer

MRP generates reports on changes to planned orders as a key output.

Question 14

Lot-for-lot ordering in MRP provides coverage for some predetermined number of periods (such as two or three) that extend beyond the orders already received for those periods.

Accepted Answer

Lot-for-lot ordering in MRP is an order quantity technique that orders exactly what is needed for production based on the net requirements, without extending coverage for additional periods beyond immediate needs.

Question 15

Safety time is sometimes used in MRP rather than safety stock quantities.

Accepted Answer

Safety time is a measure of how long it will take to receive replenishment stock, whereas safety stock is a quantity of stock held as a buffer against unexpected demand or delays in receiving replenishment. In MRP, safety time can be used instead of safety stock to ensure that there is enough time to receive inventory before running out.

Question 16

MRP output reports are divided into two main groups, daily and weekly.

Accepted Answer

MRP (Material Requirements Planning) output reports are typically divided into primary reports such as planned order reports, order release notices, and changes in due dates, rather than strictly by daily or weekly categorizations. These reports focus on what materials are needed, when they are needed, and in what quantities, rather than adhering to a daily or weekly schedule.

Question 17

MRP II is simply an improved version of MRP that processes more quickly and can plan for a larger number of end items.

Accepted Answer

MRP II (Manufacturing Resource Planning) not only includes the features of MRP (Material Requirements Planning) but also integrates additional data, such as employee and financial needs, offering a more comprehensive planning system that covers the entire manufacturing process, not just inventory management.

Question 18

A regenerative MRP system is one that is updated continuously, every time there is a schedule change.

Accepted Answer

A regenerative MRP system is one where the entire material plan is recalculated at regular intervals, not continuously updated with every schedule change.

Question 19

Project management approaches can help in a conversion to an ERP system.

Accepted Answer

Project management approaches such as agile methodology, waterfall methodology, and PRINCE2 can help in planning, implementing, and transitioning to an ERP system. These approaches provide a structured framework for managing resources, risks, timelines, and budgets, which are essential for a successful ERP implementation.

Question 20

Lot-for-lot ordering in MRP minimizes holding costs for parts that are carried over to other periods.

Accepted Answer

Lot-for-lot ordering in Material Requirements Planning (MRP) involves ordering exactly what is needed for production, minimizing excess inventory and therefore reducing holding costs associated with carrying over parts to future periods.

Quiz 17: MRP and ERP

Capacity requirements planning helps managers reconcile with .