Deck 15: Material Requirements Planning Mrp for Sporadic Demand Patterns

Question 1

Transient or phantom BOMs are used for subassemblies that are not kept in stock.

Answer 1

True

Question 2

The make-to-order (MTO) inventory environment is one where end-items are always built from subassemblies.

Answer 2

False

Question 3

The multi-level product structure was termed an explosion by Orlicky who went on to say that the task is "to identify the components of a given parent item and to ascertain the location (address) of their inventory records in computer storage."

Answer 3

True

Question 4

MRP should be used for inventory management of items that satisfy both OPP assumptions.

Question 5

Dependencies are seldom regular because the components are used in different end products,each of which has its own demand pattern.

Question 6

Low-level coding organizes order quantity calculations for parts with combined or multi-level demands.

Question 7

The system called the MPCS captures what takes place in job shops no matter where they are located globally.

Question 8

A bill of material is used in conjunction with the master production schedule to determine the items for which purchase requisitions and production orders must be released.

Question 9

Order promising by sales and marketing and order fulfillment goals of production are matched and coordinated by the MPS.

Question 10

The master production schedule has a planning horizon length that matches the longest cumulative lead-time function in that schedule.

Question 11

End products are defined as the parent product and they have independent demand systems.

Question 12

An example of a BOM for a dinner party is the cook's shopping list.

Question 13

Modular ATOs are organized so that product options can serve in place of single-product parents.To emphasize the point,modular BOMs do not exist.

Question 14

BOMs include every material that goes into or onto a product.

Question 15

Computer-based MRP systems were first described in a 1975 book by Joseph Juran.

Question 16

End-items in a make-to-order environment are usually produced to the middleman's order.

Question 17

Reorder point models require that stable demand distributions exist.This facilitates meeting forecasting requirements.

Question 18

The demand of end products is driven by the marketplace.

Question 19

The cumulative lead time for a secondary product is found by looking at the longest lead-time path to obtain all of the parts that go into it as the end-item.

Question 20

Master production scheduling converts strategic plans into a time-phased plan that indicates exactly when each SKU should be made and how much should be run.

Question 21

The two approaches for updating the MRP files and records are regeneration MRP and net change MRP.

Question 22

Exception codes are used to identify important items.

Question 23

RCCP is used preliminarily to be certain that realistic objectives are being transmitted to the MRP process.

Question 24

Failures with MRP can never be traced to having chosen software that was not well-suited to the applications.

Question 25

Costs associated with lot-for-lot sizing can be obtained by dividing the number of orders that are made using lot-for-lot by the cost of an order or setup.

Question 26

DRP2 operates as an extension of DRP1 by identifying those additional resources that will be needed in the distribution system.

Question 27

CRP serves as a precursor of the RCCP process.

Question 28

The process of determining net requirements is called netting.

Question 29

RCCP uses approximation to determine whether there is sufficient capacity to accomplish objectives.

Question 30

MRP II entails total manufacturing resource planning as part of the strategic business plan.

Question 31

Using MRP II,financial planning can access and control what is being done and determine what will be done in the future.

Question 32

Open-loop MRP implies that many functions such as manufacturing control,supplier scheduling,and dispatching are included in the overall system.Also,feedback is provided by the execution functions so that the planning can be kept valid at all times.This is in contrast to closed-loop MRP.

Question 33

Strategic business plans drive the MRPII system.

Question 34

Part numbers should be chosen randomly so as to avoid implying that they have any meaning or significance.

Question 35

Gross requirement s for end-items for week t are required by the MPS and stated by the material requirements plan (MRP report).

Question 36

Capacity requirements planning is generally applied to long-term modifications for capacity problems that are encountered as a result of infeasible MRP plans.

Question 37

MRP is vulnerable to variability in lead times.

Question 38

Closed-loop MRP is a system built around material requirements planning that includes the additional planning functions of sales and operations.

Question 39

ERP is a company-wide integration of the information system for seamless planning across one distinct function.

Question 40

The economic order quantity is calculated for items by using the traditional MTO (make-to-order) methods.

Question 41

Actual on-hand customer orders provide relatively _____ information about future demands.

A)misleading
B)solid
C)unimportant
D)minor

Question 42

_____ models are powerful as long as the assumptions for continuity hold true.

A)MRP
B)OPP
C)EOQ
D)ESL

Question 43

Lot-for-lot sizing costs can be obtained by multiplying the number of orders that are made using lot-for-lot by the cost of an order or set-up.

Question 44

Even though MRP demands are sporadic and lumpy,they can be predicted as discrete order events where there is advance knowledge about probable order placements.

Question 45

When _____ models are used to control stock on-hand for linked parts,parent demand systems often produce inventory swings that lead to overstocks and out-of-stocks.

A)MRP
B)reorder point
C)lead time
D)static inventory

Question 46

New product introductions are most likely to fail if the total organization is communicating and coordinated.

Question 47

MRPII is the foundation for Enterprise Resource Planning (ERP).

Question 48

Once the MPS is accepted and authorized,the planning process proceeds to details of scheduling that are the province of the _____ system.

A)EOQ
B)MRP
C)ELS
D)MPC

Question 49

MRP reflects the systems viewpoint by connecting the parent products and the

A)independent parts that join parent products.
B)demand distributions.
C)dependent parts.
D)supply distributions.
E)grandparent products.

Question 50

Based on systems thinking,changes to any part of the planning process should be in line with strategic business plans.

Question 51

Order promising is best defined as:

A)time between recognition of the need for an order and the acknowledged,genuine receipt of goods.
B)sales department commitments for delivery.As such,it answers the question "when can you ship?"
C)lists of all of subassemblies,parts,and raw materials that go into a parent assembly.As such,it shows the quantities required.
D)separating locations where end-items are built from locations of warehouses where subassemblies are stored.

Question 52

MRP assumptions include:

A)demand is dependent.
B)demand is independent.
C)demand is sporadic and lumpy.
D)both a and c
E)both b and c

Question 53

OPP assumptions include:

A)demand is independent.
B)demand is discontinuous.
C)demand is relatively continuous over time.
D)both a and c

Question 54

MRPII operates at the lowest level of coordination.

Question 55

Master production schedules are partially driven by

A)sales forecast.
B)actual orders on-hand.
C)both a and b
D)neither a nor b

Question 56

The MPS stage needs to be fully documented.The documents should be updated as needed.

Question 57

Transformation of MRPII to ERP in its most far-reaching form is accomplished by converting total enterprise-wide planning into separate regional business planning systems.

Question 58

One of the worst problems that MRP faces is last-minute changes in orders.

Question 59

The first book on MRP was written by _____ in 1975.

A)Joseph Orlicky
B)Modigliani
C)David Garvin
D)Robert Thurman

Question 60

Demand for an item has to be regular and relatively continuous over time for order point models and policies to be applicable.

Question 61

_____ lists the key resources needed to make a unit of a selected item.

A)DRP
B)MRP
C)RCCP
D)BOR

Question 62

What is a thorough,time-demanding method of updating the MRP information system?

A)net change MRP calculation
B)capacity requirements planning
C)regeneration MRP
D)rough-cut capacity calculation

Question 63

_____ is the function of establishing,measuring,and adjusting limits or levels of capacity.Also,it is the process of determining how much labor and machine resources are required to accomplish the tasks of production.

A)CRP
B)RCCP
C)MRP
D)DRP

Question 64

One of the worst systemic problems that MRP faces is

A)lack of commitment by management.
B)sudden cancellation of sales.
C)last-minute changes in order sizes.
D)lack of computer time.
E)both b and c

Question 65

_____ is the essence of supply chain management.

A)BOR
B)DRP
C)CRP
D)MRP

Question 66

In a _____ model the idea is to decrease the number of orders to minimize inventory costs.

A)part-period
B)intermittent flow shop
C)static inventory
D)EOQ

Question 67

What information system would require current data for the following items: stock on-hand levels,suppliers' prices,and delivery lead times?

A)inventory record files
B)bill of material records
C)make-to-order files
D)assemble-to-order files

Question 68

Closed-loop MRP consists of

A)production planning.
B)master production scheduling.
C)capacity requirements planning.
D)all of the above

Question 69

MRP record processing proceeds from one level code to the next,starting at level code

A)0.
B)1.
C)2.
D)3.

Question 70

MRP cannot be used without the appropriate set of

A)BOMs.
B)MTSs.
C)MTOs.
D)ATOs.

Question 71

The matrix _____ is a special chart for analyzing families of similar products.It arranges parts in columns and parent products in rows.The matrix characterizes modular product design goals.

A)ATO
B)MTS
C)BOM
D)MTO

Question 72

The first step in the planning hierarchy is _____ planning.

A)production
B)capacity
C)MRP
D)DRP

Question 73

DRP1 can be defined as

A)determining the needs to replenish inventory at branch warehouses.
B)using replenishment calculations based on whichever ordering system is most effective.
C)neither a nor b
D)both a and b

Question 74

In a _____ environment,there is some latitude concerning what is to be done and when it is scheduled.

A)make-to-order
B)assemble-to-order
C)design for assembly
D)make-to-stock

Question 75

_____ is a higher order planning system than _____.This higher order distribution requirements planning system examines resource availability such as storage space in warehouses,trucking capacity,railroad boxcar availabilities,distribution workforce commitments,and training.It also treats cash flow needed to keep the distribution system performing successfully.

A)DRP;DRP2
B)DRP2;DRP
C)MRP;DRP
D)MRP2;DRP2

Question 76

_____ uses the principle that the lowest position of a part should determine where that part is located for computer scanning.

A)Low-level coding
B)High-level coding
C)Coding
D)Zero-level coding

Question 77

_____ are the starting point for actual use of MRP,and the varieties are consequently instructive.

A)BOMs
B)MTSs
C)MTOs
D)ATOs

Question 78

_____ is among the simplest ordering methods,but it places more orders than other methods.These other methods compensate for fewer orders with larger order quantities.

A)MRP
B)Part-period ordering
C)Lot-for-lot sizing
D)Net change MRP

Question 79

Gross requirements less the projected stock-on-hand,at time t,are called the

A)netting needs.
B)net requirements.
C)lot-for-lot size.
D)alpha model.

Question 80

For the example in the text (see Table 15-4),when the master production schedule calls for various output amounts of _____ and _____ DVR models,the MRP must combine the demands of commonly shared parts.

A)low-price;high-price
B)heavy;light
C)alpha;beta
D)alpha;delta