Operations Management Chapter 9

From the highest level planning at the top to the lowest level planning at the bottom, rank the following. -material requirements planning -aggregate planning -master production schedule

1. aggregate planning 2. master production schedule 3. material requirements planning

What is master production scheduling?

a time-phased plan specifying how many end items the firm plans to build, and when

In which of the following industry types would MRP provide high benefits? (select all that apply) a. assemble-to-order b. make-to-order c. engineer-to-order d. assemble-to-stock

a. assemble-to-order AND c. engineer-to-order AND d. assemble-to-stock

What is a frozen time fence?

anything from absolutely no changes in one company to only the most minor of changes in another

Which of the following is true about MRP? (select all that apply) a. MRP is the highest level of planning in most organizations b. MRP is used to determine the number of parts, components, and other materials needed to produce a product c. MRP is an acronym for material requirements planning d. MRP is not used for dependent demand items

b. MRP is used to determine the number of parts, components, and other materials needed to produce a product AND c. MRP is an acronym for material requirements planning

Which of the following statements best characterizes an MRP system? a. a system that specifies the best transportation mode for inbound materials b. an independent demand system that helps a company to prioritize customer orders based on profit potential c. a system-driven logic that allows a company to tie the production functions together from a material planning and control view d. a system-driven approach to determine which suppliers are likely to meet delivery due dates

c. a system-driven logic that allows a company to tie the production functions together from a material planning and control view

What is a liquid time fence?

may allow almost any variations in products, with the provisions that capacity remains about the same and that there are no long lead times involved

Which of the following are sources of demand for products in a material requirements planning system? (select all that apply) a. customer orders from sales personnel b. customer orders that have been canceled c. inter-department transactions d. the master production schedule

a. customer orders from sales personnel AND c. inter-department transactions

Which type of time fence allows for changes to a specific product so long as parts are available? a. slushy b. liquid c. frozen d. scheduled

a. slushy

Lumpiness, or the tendency for uneven production, further down the creation sequence is a. caused by items being withdrawn from inventory in single items b. not possible with an ERP system in place c. caused by items being withdrawn from inventory in lots

c. caused by items being withdrawn from inventory in lots

The master production schedule is used to plan a. raw materials b. rework c. end items d. supply parts

c. end items

The first step in the MRP explosion process is? a. calculate the lead times for all products that have been scheduled on the master schedule b. identify the inventory on hand for all parts c. place part orders for net requirements d. retrieve the gross requirements for end items from the master schedule

d. retrieve the gross requirements for end items from the master schedule

A company producing widgets only needs Part A for 40% of the widgets built. This company is likely using what type of bill-of-material? a. modular BOM b. deluxe BOM c. partial BOM d. super BOM

d. super BOM

Level 0 items during the explosion process are typically referred to as _____________ items, or gross requirements

end

True or false: Finished goods purchased by individuals external to the organization are considered dependent demand items.

false

What is a slushy time fence?

may allow changes in specific products within a product group so long as parts are available

An item that can be produced and stocked as a subassembly often uses a ____________ bill-of-materials for planning.

modular

After finding gross requirements, the next step in the MRP explosion process references inventory on hand and scheduled orders to calculate _________ requirements.

net

The ultimate goal of any MRP lot sizing approach is to balance the setup or ________________ costs and the ______________ costs associated with meeting the net requirements generated by the MRP planning process. (Enter only one word per blank.)

order, holding

What is a bill-of-materials?

the complete product description, listing the materials, parts, and components, and also the sequence in which the product is created

What is material requirements planning?

the logic for determining the number of parts, components, and materials needed to produce a product

________________ _____________ is/are a company's attempt to provide a controlled window of opportunity to make changes to the master production schedule.

time fences

What is enterprise resource planning?

a computer system that integrates application programs in accounting, sales, manufacturing, and the other functions in a firm

What is available to promise?

a feature of MRP systems that identifies the difference between the number of units currently included in the master schedule and the actual (firm) customer orders

A material requirements planning system interfaces with the master production schedule, bill-of-materials file and __________. a. inventory records file b. forecasted sales c. product demand d. customer purchase order

a. inventory records file

The inventory records file contains information such as (select all that apply) a. lead time b. item description c. planned order releases d. safety stock e. list of authorized suppliers

a. lead time AND b. item description AND c. planned order releases AND d. safety stock

______________ are the part quantities issued in the planned order receipt and planned order release sections of an MRP schedule. a. lot sizes b. demand numbers c. economic order quantity d. least total cost

a. lot sizes

The master production schedule typically deals with end items, but can be broken down to __________ if the item is large or expensive. a. major subassemblies b. inexpensive components c. single use d. work-in-process

a. major subassemblies

Which of the following is NOT a part of the material requirements planning system? a. supplier delivery schedule b. master production schedule c. inventory records d. bill-of-materials

a. supplier delivery schedule

The file containing the complete product description, parts listing, quantity needed and product build sequence is called? a. the bill-of-material b. the MPS c. the peg record d. the inventory log

a. the bill-of-material

Which of the following would be located on the MPS plan? (select all that apply) a. vehicle engine purchased for a production line b. a new vehicle purchased from an automotive dealer c. pen caps ordered by a pen manufacturer from a supplier d. pens ordered from an office supply company

b. a new vehicle purchased from an automotive dealer AND d. pens ordered from an office supply company

Outside of determining parts, components, and materials, MRP provides a. a forecast for the next 6 months b. a schedule for when each of these should be produced or ordered c. independent demand for products being produced d. the total plan for all capital investments needed

b. a schedule for when each of these should be produced or ordered

If a company has more units in the master production schedule than firm customer orders, the residual is called? a. customer overstock b. available to promise c. liquid inventory d. ready to ship

b. available to promise

Some benefits of an ERP system are (select all that apply) a. human resources knows how many employees to schedule b. quality management can develop inspection points for products during manufacturing c. sales can track all the details of an order d. manufacturing knows about orders as soon as they are entered

b. quality management can develop inspection points for products during manufacturing AND c. sales can track all the details of an order AND d. manufacturing knows about orders as soon as they are entered

At any point in time, an MRP system can access the status segment of the inventory record according to specific time periods commonly known as a. bill-of-material b. time buckets c. product part matrix d. low-level coding system

b. time buckets

Which of the following is/are issues a master scheduler must consider? (select all that apply) a. adjust the raw material supply schedule as needed b. trade-off manufacturing, engineering and marketing conflicts c. the firms financing plans d. be involved with customer order promising e. never lose sight of the aggregate plan

b. trade-off manufacturing, engineering and marketing conflicts AND d. be involved with customer order promising AND e. never lose sight of the aggregate plan

MRP systems tend to work best in companies where products are made in ______________ using the same productive equipment.

batches

The next level in the planning process down from an aggregate plan is called? a. supply coordination b. demand forecasting c. the master production schedule d. materials requirements planning

c. the master production schedule

a(n) ____________ ___________ ___________ system is a computer system that integrates application programs from the functional areas of a firm

enterprise resource planning

What is the purpose of time fences?

to maintain a reasonably controlled flow through the production system