Deck 7: Dependent Demand Inventory

Question 1

Fixed order quantity lot size has a variable order size based on lead time.

Answer 1

False

Question 2

Every finished product has a bill of materials that specifies all components required to produce one unit of the finished product.

Answer 2

True

Question 3

Lead time is the estimate of the time between releasing an order and receiving the order,and is always known with certainty.

Answer 3

False

Question 4

Recording inventory transactions accurately and promptly is a critical component of an effective MRP system.

Question 5

Planned receipts are future orders that have not yet been released but are planned in order to avoid a shortage or backlog of inventory.

Question 6

Every MRP record includes three planning factors: lot size,lead time,and material cost.

Question 7

Additional computing power has made MRP systems more common.

Question 8

Scheduled receipts are the total number of units of a part derived from all parent production plans.

Question 9

When graphed,dependent demand will appear lumpy rather than even.

Question 10

In an MRP system,the production order is offset to account for the lead time.

Question 11

An MRP system creates a master schedule.

Question 12

An inventory transaction occurs when there is any change in the quantity of a specific part or material.

Question 13

Small changes to the bill of materials are normally not critical to the MRP system and have little impact on the final output.

Question 14

A bill of materials database is a basic output of an MRP system.

Question 15

MRP planning factors are managerial choices.

Question 16

A time bucket is the period in the future that is being planned.

Question 17

Dependent demand is demand for items that are used to make another item.

Question 18

Safety stock is excess inventory that a company holds to guard against uncertainty in demand,lead time,and supply.

Question 19

Inventory records include transactions both from manufacturing within an organization and from purchasing items from external suppliers.

Question 20

MRP provides a specialized approach for dealing with items with independent demand.

Question 21

Which of the following is not an objective of the master schedule?

A)To balance the workload for a company in terms of total capacity
B)To minimize total cost
C)To assess the impact of new orders
D)To identify available parts
E)To freeze customer orders as soon as possible

Question 22

Part E is an example of a ____.

A)Parent part
B)Common part
C)Low-level part
D)Critical part
E)Safety stock

Question 23

An item that is manufactured from component parts is known as

A)An assembly
B)A parent
C)A sibling
D)A child
E)A multiple component

Question 24

An expansion of MRP to include other nonproduction company systems including finance,accounting,purchasing,and logistics is MRP II.

Question 25

The choice of lot size rules has little impact on the effectiveness of the MRP system.

Question 26

The document that details the quantity of end items to be produced within a specified period of time is

A)Bill of material
B)Master schedule
C)Inventory record
D)Lead time
E)Periodic order quantity

Question 27

L4L lot sizes minimize inventory levels by ordering only what is needed.

Question 28

A product structure tree is often used to visually represent the.

A)Bill of materials
B)Master schedule
C)Inventory records
D)Lead time
E)Periodic order quantity

Question 29

MRP nervousness describes the situation where a change at one MRP level ripples down to effect lower-level parts.

Question 30

The finished product is located at what level of the BOM?

A)Level 0
B)Level 1
C)Level 2
D)The lowest level
E)Another location

Question 31

The POQ lot size to arrive in period t is the gross requirements for P periods,including period t,minus the projected on-hand inventory at the end of period (t - 1),minus the required safety stock.

Question 32

For the following product structure tree,how many units of part E will be required for each A?

A)1
B)2
C)3
D)5
E)6

Question 33

Capacity limitations that must be considered before finalizing the master schedule include all of the following except

A)Labor capacity
B)Machine capacity
C)Storage space
D)Transportation equipment
E)Orders on the books

Question 34

Which of the following items is an MRP input?

A)Action notices
B)Lead time
C)Inventory records
D)The fixed order quantity
E)The lot size

Question 35

Engineering and process design information is critical to preparing which MRP input?

A)Bill of materials
B)Master schedule
C)Inventory records
D)Lead time
E)Periodic order quantity

Question 36

An action notice signals when to release an order or when a change is required.

Question 37

Training is a key component of making an MRP system work.

Question 38

Periodic order quantities are designed to order exactly the amount required for a specified period of time.

Question 39

In an MRP system,the records developed assume that sufficient capacity is available for the required production.

Question 40

An MRP system is static,that is,once a plan is created,it is seldom modified.

Question 41

Provide three factors that may influence the lot size decision for a fixed order quantity.

Question 42

Which phrase refers to a situation in MRP planning where a change in one part level ripples down to affect lower-level parts?

A)Safety stock
B)MRP explosion
C)MRP nervousness
D)Capacity planning
E)MRP rolling schedule

Question 43

____ represent/represents orders that have been placed but not yet received or completed.

A)Gross requirements
B)Scheduled receipts
C)On-hand inventory
D)Buckets
E)Safety stock

Question 44

Which of the following items enhances the effectiveness of an MRP system?

A)Minimal size lots
B)A rapidly changing manufacturing environment
C)Accurate inventory records
D)Maximum lead times
E)Large safety stocks

Question 45

Which of the following industries would probably not utilize service resource planning?

A)Airlines
B)Grocery stores
C)Restaurants
D)Hospitals
E)Bicycle manufacturers

Question 46

The report for a work center that projects already scheduled and expected future capacity requirements against capacity availability is called.

A)Net change update report
B)Periodic change update report
C)Capacity requirements planning report
D)Action notice report
E)Load report

Question 47

Why are lot size rules important?

A)They determine the frequency of setups
B)They maximize shipping costs
C)They are arbitrary
D)They encourage on-time delivery
E)They minimize scheduled receipts

Question 48

A technique that offers customers incentives to shape their demand patterns refers to

A)Customer relationship management
B)Yield management
C)MRP II
D)Load reporting
E)Capacity requirements planning

Question 49

Give three reasons for carrying safety stock.

Question 50

Give three examples of specific inventory transactions.

Question 51

What are the key inputs to an MRP system?

Question 52

Which of the following is not critical for an MRP system to work?

A)Extremely accurate input records
B)Extensive training for users
C)Carefully designed software
D)Carefully set up hardware
E)Simplified product designs

Question 53

If a planned receipt for an item is due in week 5 and the item's lead time is 3 weeks,when will the corresponding planned order release occur?

A)Week 2
B)Week 3
C)Week 5
D)Week 7
E)Week 8

Question 54

For items that are manufactured within a company,the lead time must take into account all the following factors,except

A)Setup time
B)Processing time
C)Material handling time
D)Waiting time
E)Development time

Question 55

LFL minimizes inventory levels by.

A)Ordering only what is needed
B)Ordering the same amount every time
C)Ordering what is needed for a given time bucket
D)Replacing the safety stock
E)Ordering truck load quantities

Question 56

L4L rules are most appropriate for what type of items?

A)Perishable items
B)Common items
C)Expensive items
D)Items with a complicated setup process
E)Items with a high ordering cost

Question 57

Which of the following is included in an MRP II system but not in an MRP system?

A)Capacity planning
B)Inventory records
C)Accounting systems
D)Bill of materials
E)Master schedules

Question 58

Which of the following items is not involved in developing an inventory record for a single item?

A)Lot size
B)Lead time
C)Safety stock
D)Time bucket
E)Inventory transactions

Question 59

Briefly describe the FOQ,POQ,and L4L lot sizing rules.

Question 60

If 40 units are on hand,the gross requirements for the next period are 120 units,and scheduled receipts for the next period is 200 units,what will the on-hand inventory level be at the beginning of the next period?

A)40
B)80
C)120
D)160
E)200

Question 61

Give three options a manager can take when a load report is generated which shows that more capacity is required than is available.

Question 62

Determine the quantity of part D required to build each item X.

Question 63

Describe three factors that contribute to MRP success.

Question 64

If a product has gross requirements of 200,and inventory of 220 is on hand,what amount should be ordered? What would be the inventory on hand in the next period (no safety stock is required)?

Question 65

What factors go into determining the lot for lot size to arrive in a given period?

Question 66

Briefly describe an MRP explosion,and identify three sources gross requirements are derived from.

Question 67

If 4000 six-pack colas are required,and 2000 six-packs are on hand,how many individual cans should be ordered if 3000 individual cans are also on hand?

Question 68

Determine the quantity of part E required to build 100 item X.

Question 69

If a lot size of 200 is required,and 125 parts are on hand,what amount should be ordered to meet a demand of 250? What will the inventory level be in the next period?

Question 70

Answer the following.

Question 71

Describe the differences in the evolution of MRP,MRP II,and ERP.

Question 72

If 500 units of item 11001 are required in week 8,what is the planned order release amount and period for item 21001? On hand are 15 units of part 11001,8 of part 21001,20 of part 21002,and 75 of part 31002.

Question 73

What is the amount of inventory on hand during week 3?

Question 74

A six-pack comprises six cans of soda.A can of soda is composed of 12 ounces of the beverage.No inventory is available.How many ounces of soda are required to deliver 325 six-packs?