mgmt339_C12_T/F
20. A net-change MRP system is one that is updated periodically but not less frequently than once a week.
F / A net-change system is updated as transactions occur.
Independent demand tends to be more 'lumpy' than dependent demand meaning that we need large quantities followed by periods of no demand.
F / Dependent demand is more lumpy
38. MRP really doesn't apply to services since raw material isn't required.
F / MRP can be used in services.
The gross requirements value for any given component is equal to the net requirements of that component's immediate parent multiplied by the quantity per parent.
F / Released order quantities for the parent lead to gross requirements of the child.
15. An assembly-time chart indicates gross and net requirements taking into account the current available inventory.
F/ Assembly-time charts have to do with capacity, not inventory.
32. Capacity requirements planning (CRP) is an important feature in MRP+.
F/ CRP is a feature of MRP II.
. 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.
F/ EOQ is more useful at lower levels since lower-level items often have less lumpy demand.
Net requirements equal gross requirements minus safety stock.
F/ If safety stock is required, net requirements will be higher.
13. The bill of materials contains information on lead times and current inventory position on every component required to produce the end item.
F/ Inventory records contain this information.
. Low level coding represents items less than $18 per unit.
F/ Low-level coding codes items at their lowest BOM levels.
30. MRP II is simply an improved version of MRP that processes faster and can plan for a larger number of end items.
F/ MRP II takes into account capacity requirements.
10. MRP, considering inventory position, bills of material, open purchase orders and lead times guarantees a feasible production plan if the inputs to MRP are accurate.
F/ MRP may lead to an infeasible production plan if capacity requirements are not considered.
17. The gross requirements at one level of an MRP plan determine the gross requirements at the next lower level continuing on down to the lowest levels shown on the bill of material.
F/ Released order quantities at one level determine gross requirements at the next lower level.
11. The bill of materials indicates how much material will be needed to produce the quantities on a given master production schedule.
F/ The bill of materials indicates how much material will be needed to produce one unit of the item in question.
Lot-for-lot ordering in MRP provides coverage for some predetermined number of periods using forecasted demand to extend beyond the orders already received for those periods.
F/ This is fixed-period ordering.
26. MRP output reports are divided into two main groups - daily and weekly.
F/ primary and secondary
34. As long as a forecast is plus or minus 10%, MRP works well.
F/MRP needs accurate forecasts.
22. A regenerative MRP system is one that is updated continuously - every time there is a schedule change.
F/Regenerative systems are updated periodically.
. Initially, a master production schedule - the output from MRP - may not represent a feasible schedule.
T
. Load reports show capacity requirements for departments or work centers which may be more or less than the capacity available in that work center.
T
12. A bill of materials contains a listing of all the assemblies, parts, and materials needed to produce one unit of an end item.
T
14. The inventory records contain information on the status of each item by time period.
T
19. The term pegging refers to identifying the parent items that have generated a given set of material requirements for a part or subassembly.
T
21. 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.
T
23. One of the primary output reports of MRP concerns changes to planned orders.
T
24. Safety time is sometimes used in MRP rather than safety stock quantities.
T
29. ERP began in manufacturing organizations but has spread into service organizations.
T
31. Lot-for-lot ordering in MRP eliminates the holding costs for parts that are carried over to other periods.
T
35. ERP represents an expanded effort to integrate standardized record-keeping that shares information among different areas of an organization.
T
36. Back flushing takes place after the production has been completed.
T
37. Before a schedule receipt can take place, and order must be placed with a vendor. TRUE
T
39. ERP implementation requires support and a direct mandate from the CEO because it impacts so many different functional areas.
T
40. ERP automates the tasks involved in performing a business process, such as order fulfillment and financial reporting.
T
5. MRP is used within most MRP II and ERP systems.
T
8. The master schedule needs to be for a period long enough to cover the stacked or cumulative lead time necessary to produce the end items.
T
The master production schedule states which end items are to be produced, in addition to when and how many.
T
4. Lumpy demand for components results primarily from the periodic scheduling of batch production.
T/ Batch production leads to lumpy demand for components.
16. MRP II did not replace or improve the basic MRP.
T/ MRP II incorporates basic MRP.
MRP works best if the inventory items have dependent demand.
T/ best for dependent demand
