Chapter 15

34. The last stage in ERP implementation involves analyzing business processes.

False

62. Given the following Product Structure Record The number of G's required to assemble 10 A's would be a. 9 b. 10 c. 90 d. 180

C

56. Given the following MRP matrix for Item C: ITEM: C Lot Size: POQ LT: 2 Period 1 2 3 4 5 6 7 8 Gross Requirements 70 90 150 150 180 290 120 150 Schedule Receipts 200 Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If each order cost $500 and the holding cost is $0.75 per item per period, the periodic order quantity would be a. 3 periods of requirements b. 2 periods of requirements c. 1 period of requirements d. 0 period of requirements

A

66. Given the following MRP matrix for Item E: ITEM: E Lot Size: L4L LT: 3 Period 1 2 3 4 5 6 7 Gross Requirements 200 100 200 200 300 200 300 Schedule Receipts 300 Project on Hand 500 Net Requirements Planned Order Receipts Planned Order Releases The planned order releases for period 4 would be a. 300 b. 200 c. 75 d. 0

A

38. The product structure file lists all of the following except a. the product's demand. b. the items that go into the product. c. a brief description of each item. d. when and in what quantity each item is needed in the assembly process.

A

48. Which of the following would not be used for an overloaded condition? a. pulling work ahead b. rerouting jobs to alternative work centers c. pushing work back d. splitting lots between two or more machines

A

40. A _______________ of material is used to plan the production of products with many optional features. a. K-bill b. modular bill c. phantom bill d. time-phased bill

B

44. ______________ is a lot sizing technique that orders for multiple demand periods is referred to as a. Lot-for-lot (L4L) b. Periodic order quantity (POQ) c. Economic order quantity(EOQ) d. Multiple order quantity (MOQ)

B

53. Given the following MRP matrix for Item D: ITEM: D Lot Size: Min 100 LT: 2 Period 1 2 3 4 5 6 7 Gross Requirements 60 90 150 150 180 270 120 Schedule Receipts 150 Project on Hand 120 Net Requirements Planned Order Receipts Planned Order Releases The planned order release for period 5 would be a. 100 b. 120 c. 160 d. 270

B

58. Given the following MRP matrix for Item C: ITEM: C Lot Size: POQ LT: 2 Period 1 2 3 4 5 6 7 8 Gross Requirements 70 90 150 150 180 290 120 150 Schedule Receipts 200 Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If each order cost $500 and the holding cost is $0.75 per item per period, then using the Periodic Order Quantity lot sizing technique, the Planned Order Release for period 4 would be a. 270 b. 290 c. 340 d. 560

B

65. Given the following MRP matrix for Item E: ITEM: E Lot Size: L4L LT: 3 Period 1 2 3 4 5 6 7 Gross Requirements 200 100 200 200 300 200 300 Schedule Receipts 300 Project on Hand 500 Net Requirements Planned Order Receipts Planned Order Releases The planned order releases for period 3 would be a. 300 b. 200 c. 75 d. 0

B

67. A firm has the following gross requirements for Item F. If ordering costs are $60 per order and carrying costs are $0.50 per period. Item F LT: 1 Period 1 2 3 4 Gross Requirements 60 40 80 60 Schedule Receipts Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If L4L ordering is used the planned order releases would be a. 40 in period 1 and 0 in period 3 b. 80 in period 2 and 60 in period 3 c. 60 in period 2 and 80 in period 3 d. 0 in period 1 and 40 in period

B

37. All of the following are inputs into the MRP process except a. the master production schedule. b. the product structure file. c. the item master file. d. the planned order report.

D

42. The MRP process of subtracting on-hand quantities and scheduled receipts from gross requirements to produce net requirements is referred to as a. cycle counting. b. lot sizing. c. exploding. d. netting.

D

43. The MRP process of determining requirements for lower level items based on the master production schedule is referred to as a. lot sizing. b. netting. c. backward scheduling. d. exploding.

D

46. A load profile compares a. requirements for all lower-level items to higher-level items. b. cumulative lead times to projected lead times. c. the quantities in which items should be produced to actual demand. d. released and planned orders with work center capacity.

D

47. All of the following can be used for underloaded conditions except a. acquiring additional work. b. pushing work back. c. pulling work ahead. d. reducing normal capacity.

D

50. Given the following Product Structure Record The number of D's required for each A would be a. 2 b. 3 c. 6 d. 12

D

54. Given the following MRP matrix for Item D: ITEM: D Lot Size: Min 100 LT: 2 Period 1 2 3 4 5 6 7 Gross Requirements 60 90 150 150 180 270 120 Schedule Receipts 150 Project on Hand 120 Net Requirements Planned Order Receipts Planned Order Releases The planned order receipt for period 6 would be a. 100 b. 120 c. 160 d. 270

D

61. Given the following Product Structure Record The number of F's required for each A would be a. 6 b. 12 c. 18 d. 24

D

63. Given the following MRP matrix for Item E: ITEM: E Lot Size: L4L LT: 3 Period 1 2 3 4 5 6 7 Gross Requirements 200 100 200 200 300 200 300 Schedule Receipts 300 Project on Hand 500 Net Requirements Planned Order Receipts Planned Order Releases The planned order releases for period 1 would be a. 300 b. 200 c. 75 d. 0

D

21. Material requirements planning (MRP) is more useful for simple products and less useful for complex products.

FALSE

10. Modular bills of material are used to group small, lose parts together into a kit.

False

11. Information concerning on-hand quantities, lot sizes and, lead time, figures can be found in the master production schedule (MPS).

False

14. The periodic order quantity (POQ) lot sizing technique that places orders every demand period.

False

18. The application modules that comprise the ERP system are designed to support only customer relationship management processes.

False

19. ERP systems are only concerned with production and marketing processes.

False

22. The total length of time to purchase an item from a supplier is called its cumulative lead time.

False

25. A phantom bill of material is appropriate when a product consists of assemblies that are later combined to form a variety of final products.

False

27. Firms that successfully implement an MRP system no longer require cycle counting of inventory.

False

28. A matrix is used to organize and display the information generated by the MRP process.

False

3. One objective of material requirements planning (MRP) is to utilize all available capacity.

False

31. Enterprise resource planning integrates business processes at the expense of customer interaction.

False

6. A forecast of dependent demand requirements is one of the major inputs into the MRP process.

False

8. The master production schedule (MPS) is a major output of the MRP process.

False

9. The optimal time required to manufacture a product is called its cumulative lead time.

False

1. Lot sizing rules are used in MRP to determine work or purchase order quantities.

True

1. Material requirements planning (MRP) translates the master production schedule into requirements for components, subassemblies, and raw materials.

True

13. Planned order releases at one level of a product structure generate gross requirements at the next level.

True

15. Capacity requirements planning (CRP) projects the load from a given material plan onto the capacity of a system.

True

16. A load profile displays underloads and overloads.

True

17. An enterprise resource planning (ERP) system shares information across functional areas.

True

2. Capacity requirement planning (CRP) converts the material plan into labor and machine workloads.

True

20. Customer relationship management (CRM) software plans and executes business processes that involve customer interactions.

True

23. The quantities reported on a master production schedule may reflect a combination of actual and forecasted demand.

True

24. The quantities displayed on a master production schedule represent production and not actual demand.

True

26. Because the item master file is an input into the MRP process it should be updated to reflect any revisions or changes.

True

29. Effective capacity is determined by multiplying the rated capacity by utilization and efficiency.

True

30. Load leveling is used to resolve underloaded and overloaded capacity conditions.

True

32. ERP application modules can be used alone or in combination.

True

33. Single-source ERP systems are often easier to integrate than systems built using the best-in-breed approach.

True

35. Customer relationship management systems change the focus from managing products to managing customers.

True

4. A material requirements planning (MRP) system serves as both an inventory control system and as a production scheduling system.

True

5. Material requirements planning (MRP) is useful for managing and scheduling discrete demand items.

True

7. Very simple products typically do not require material requirements planning (MRP) to plan production or monitor inventory levels.

True

59. Given the following MRP matrix for Item C: ITEM: C Lot Size: POQ LT: 2 Period 1 2 3 4 5 6 7 8 Gross Requirements 70 90 150 150 180 290 120 150 Schedule Receipts 200 Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If each order cost $500 and the holding cost is $0.75 per item per period, then using the Periodic Order Quantity lot sizing technique, the Projected on Hand at the end of period 7 would be a. 330 b. 270 c. 0 d. 140

c

64. Given the following MRP matrix for Item E: ITEM: E Lot Size: L4L LT: 3 Period 1 2 3 4 5 6 7 Gross Requirements 200 100 200 200 300 200 300 Schedule Receipts 300 Project on Hand 500 Net Requirements Planned Order Receipts Planned Order Releases The projected on hand quantity at the end of period 3 would be a. 0 b. 100 c. 300 d. 500

c

41. The item master file contains all the following except a. on-hand quantities. b. lead times. c. planned order releases. d. on-order quantities.

C

45. Which of the following is not a major input into capacity requirements planning (CRP)? a. planned order releases b. routing file c. load profiles for each work center d. open orders file

C

36. Material requirements planning (MRP) is a useful for all of the following except a. dependent demand items. b. discrete demand items. c. independent demand items. d. erratic orders.

C

39. A phantom bill of material is used a. to group small, loose parts together. b. when the product is manufactured in major subassemblies. c. for subassemblies that are immediately consumed in the next stage of production. d. when due dates have not been calculated.

C

57. Given the following MRP matrix for Item C: ITEM: C Lot Size: POQ LT: 2 Period 1 2 3 4 5 6 7 8 Gross Requirements 70 90 150 150 180 290 120 150 Schedule Receipts 200 Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If each order cost $500 and the holding cost is $0.75 per item per period, then using the Periodic Order Quantity lot sizing technique, the Planned Order Release for period 1 would be a. 270 b. 290 c. 340 d. 560

C

60. Given the following Product Structure Record The number of I's required for each A would be a. 1 b. 2 c. 6 d. 12

C

68. A firm has the following gross requirements for Item F. If ordering costs are $60 per order and carrying costs are $0.50 per period. Item F LT: 1 Period 1 2 3 4 Gross Requirements 60 40 80 60 Schedule Receipts Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If EOQ lot sizing is used the minimum order quantity would be a. 85 b. 100 c. 120 d. 150

C

69. A firm has the following gross requirements for Item F. If ordering costs are $60 per order and carrying costs are $0.50 per period. Item F LT: 1 Period 1 2 3 4 Gross Requirements 60 40 80 60 Schedule Receipts Project on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases If EOQ lot sizing is used to set the minimum order quantity, then the planned order releases would be a. 40 in period 1 and 0 in period 3 b. 0 in period 2 and 80 in period 3 c. 120 in period 2 and 120 in period 3 d. 100 in period 2 and 100 in period 3

C