Section G: Material Requirements Planning
Gross requirements for a period on the material requirements planning grid are 100 units for unit A. Two units of A are needed to make one unit of Z. If net requirements are 80 units, what was the available inventory of A?
20 units
A component has net requirements for 47 pieces for a future date. A cycle adjustment just reduced on-hand inventory by 17 pieces. What will be the new net requirements for material requirements planning?
64
There is a scheduled receipt in week 4 for an item with a two-week lead time. What can be inferred from this information?
A firm planned order must have been used to provide more lead time. Note: I thought that there would be a shown planned order release in week 2 (which is true) but after it is released, that information would be removed and wouldn't be shown on the grid. It would only show as a scheduled receipt. It can not exist as scheduled receipt and a planned order receipt/release.
What is a Where used List?
A listing of every parent item that calls for a given components and the representative quantity required FROM the BOM.
Which items in an indented bill of material will be purchased components?
All items on a bill that do not have further indented items below them
What does it mean when a material requirements planning (MRP) planned order is released?
Authorization has been given to manufacture or purchase the item. NOTE: When the manufacturing or purchasing planner has been authorized by the MRP output, the planner can release planned purchasing and manufacturing orders.
What document shows the component parts and number of components needed to make one unit of the part?
Bill of materials
This type of MRP records show the exact date on which a specific action is required.
Bucketless
What addresses the availability of resources to meet the priority requirements
Capacity planning
Deterimining when to schedule supply depends on WHAT?
Demand
True or False There will be a bill of materials for items that are purchased?
False
Because bills of material (BOMs) identify the exact materials used in production and can include component and subcomponent cost information, they are also useful for which other department?
Finance because help determine the direct materials used in the product which is helpful in calculating labor and allocation of overhead
Which types of orders are considered to be under the control of the planner?
Firm planned orders & Released (open) orders ONLY
How do gross requirements differ from net requirements?
Gross requirements do not consider available inventory or scheduled receipts.
When would a a Where-Used report be useful.?
IT might assist in costing products or determining the impact of an engineering change for a component
When would a pegging report be useful?
If a material will arrive late, there are supply chain interruptions, or the material has increased in price. -Find the customer affected by a delayed purchase component
What is the material requirements plan?
It is a technique that uses bill of materials, Inventory Data, and Master production schedule to calculate the requirement for materials.
In a single-level bill of material, a component amount has been left blank. What does this indicate?
It is not possible to measure the component in standard quantities accurately. ie. Caulking, glue
An item from a BOM can be both dependent and independent if
It is sold independently as a replacement part
What is a requirements explosion?
It is the process of calculating the demand for components of a PARENT item by multiplying the parent item by the component usage quantity specified in the BOM
What is the objective of MRP
Keep priorities current, or due dates for end items current
What is the objective of capacity planning?
Keep the factories busy
A lean manufacturer operates a pull system. However, they may produce items that require certain push components. This will occur for items with:
Longer lead times than CUSTOMER LEAD TIME allows!
Name a few STATIC planning factors related to inventory
Lot size Lead time Yield and scrap factors Safety stock levels
Which is a major input to a material requirements planning system?
Master production schedule
What are the three (3) basic sources of information used as inputs to material requirements planning?
Master production schedule Bill of Materials (BOM) Inventory records
What planning process bridges the gap between Master Planning and the work on the shop floor?
Material Requirements PLANNING
What is the name of the set of priority planning techniques for planning component items below the end-item level?
Material requirements plan
What provides information on component availability?
Material requirements plan Remember: provides info on Material data, inventory data, and master production schedule to calculate requirements for materials.
A set of techniques that uses bill-of-material data, inventory data, and the master production schedule to calculate requirements for materials is known as:
Material requirements planning
Determining what is required, how much is required, and when it is required is a key function of what manufacturing planning and control process?
Material requirements planning
What is the objective of aggregate inventory management?
Minimizing inventory investment
Within a given period: Opening balance = 350 Gross requirements = 50 Scheduled receipts = 75 Gross requirements in the next period = 500 What quantity should the planned order release be in this period?
Net Requirements = Gross Requirements - Scheduled Receipts - Available Inventory 125 units
Name a few DYNAMIC inventory status factors
On hand Allocated On order
The ability to relate the demand for an item shown on a material requirements planning grid back to the parent creating the demand is called what?
Pegging
What tool could be used to find the customer affected by a delayed purchased component?
Pegging report
What Term applies to a suggested order quantity, release date, and due date created by the planning system's logic when it encounters net requirements in processing material requirements planning (MRP)?
Planned Order
when looking at an MRP record list, the quantities to be received in a given period are called.....?
Planned order receipts.
What is the term for the row on a material requirements planning (MRP) grid that is derived by taking the planned receipt quantity and offsetting to the left by the appropriate lead time?
Planned order release
One hundred units of part A are needed at the start of week 6. They have a one-week lead time. Two part Bs are needed for one part A, and Bs have a two-week lead time. Which shows a proper exploding and offsetting entry in the material requirements planning grid?
Planned order release of 200 Bs in week 3.
What two (2) functions does MRP need to have activated to be successful?
Planning and Control
This type of bill is primarily used in assemble to order environments.
Planning bill
In a planning bill for an updated configuration of a cellphone, the total percentages for the amounts required for the three possible memory chips used equal 115. What does this indicate?
The company is hedging against volatile demand. This is just a plan and no orders have yet been recieved.
What is capacity requirements planning?
The most detailed level of capacity planning which looks at all resources instead of just the key/critial resources.
An assembly is manufactured in a single work center without any intermediate steps or processes. The bill of material for the assembly has multiple levels. What, if any, action should be taken?
The multiple bill-of-material levels should be consolidated into a single-level bill of material. Note: There are no intermediate steps and everthing is created in one operation, so a single level BOM would eliminate unnecessary steps and show how the product is actually produced.
In a lean environment, it is possible for two or more conventional bills of material to be combined, therefore reducing the number of overall bills needed. This will likely be because:
The part is needed for the next process.
What is a Pegging report?
The pegging data/report is active Where used Data. it identifies the given item and the source of its gross requirements or allocations.
The gross requirements for a Child item are always based on what?
The planned order release of its direct parent item.
What is a scheduled order receipt?
These are the planned orders that have already been released and account payable records have been created. Money is committed. Looking forward on the MRP record list, planned orders and planned releases are just PLANS. Once a planned order is released, it deleted from planned orders & releases and moved to Scheduled. It is no longer a plan.
How are BOM useful for finance?
They can help summarize the cost information for the end item as well as the direct labor and provide a means of allocating overhead
Describe independent demand
This descries the demand for the end item. Based on forecast
What is planned order release?
This is the amount to be released, accounting for lead time, in a certain period. Ex. if 100 items are needed in week 4 and they have a 2 week lead time. The planned order receipt for week 4 would be 100 and the planned order release would be 100 for week 2.
To break down what is needed for each building operation, which type of BOM is used?
This would be a breakdown of a multilevel BOM to a single level BOM. It eliminates unnecessary admin steps and better depicts how the product is actually produced.
What is the basic function of MRP?
To transform independent demand to dependent demand
What are the three (3) terms MRP must answer to determine material requirements?
What How much When
Describe dependent demand
When an item(s) are needed as components to build a final end item. Subcomponents Based on calculation
A buyer needs to make a component change to every parent item that currently is made with it. In order to prepar
Where used list
A cellphone manufacturer uses the same speaker module on every phone model it produces. The manufacturer keeps a report of every model for which it is used and in what quantity. What is this report called?
Where- Used List
An artificial grouping of items or events in a bill-of-material format used to facilitate production planning is known as:
a PLANNING bill of materials
Describe a single level BOM
a display of components with Parent and its direct children. A series of single level bills will need to be stored in the system to fully define a product
A scheduled receipt in material requirements planning is:
an open order that has an assigned due date. note: A scheduled receipt is an open order that has an assigned due date.
If a bill of material contains an independent demand item that is not sold as a spare part, where will the item be found?
it will be at the TOP
When a customer orders a laptop online and selects from a variety of different options, such as RAM, hard disk space, color, etc., an order entry system will produce a modular:
modular bill of materials
A manufacturer of laptops knows roughly which components will be included in each laptop configuration they offer. To facilitate master scheduling and material planning, the necessary components and subassemblies can be grouped together in a particular type of document, even though specifics of an order have not yet been received. What is this document called?
planning bill of materials
What is the name of the technique used to implement the priority plan established by the MRP process?
production activity plan
A customer has doubled its order for ski boots, which means that the manufacturer will not be able to meet the tight deadline. In addition, some of the pre-made clasps have been rejected after suffering transit damage, which means expediting the ski boot order is not an option. What action remains to the planner to address these issues?
replanning
What is Pegging?
The ability to identify for a given item the current source of demand (All the parents that require the demand)
What is true of part numbers and their relationship on bills of material?
A part at a particular processing stage has one and only one part number.
What does an open order report show?
A released manufacturing order, or a purchase order, an unfulfilled customer order
The output of MRP is provided to what functions?
Product activity control and Purchasing to determine build/buy
Parts with no children are generally _______.
Purchased parts or raw materials
There are no planned order releases in week 1, but there is a planned order release for 50 As in week 2. The As have a one-week lead time. After advancing forward one week in time, what action will be recommended in the action time bucket?
Release planned order release of 50 As. NOTE: The action time bucket is the current period 1. Right now there is nothing in the action time bucket. However, next week, the current week 2 will become week 1 and will become the action time bucket. Therefore, the planned order release for 50 As will be recommended for release.
What should happen in the material requirements planning system if delivery dates change due to purchasing or delivery delays?
Replanning should be done to keep plans current Note: A change in delivery dates or purchasing delays need replanning.
The components for a product have been identified. The demand for each component must then be calculated before the MRP record can be completed. This is known as:
Requirements explosion
Multiplying the requirements for each material or component in a bill of material by its usage quantity and recording the results in a product tree is known as:
exploding bill of materials
Net requirements are equal to:
gross requirements minus scheduled receipts minus available inventory.
A lead-time offset is a technique used in material requirements planning (MRP) where a planned order receipt in one time period will require the release of that order:
in an earlier time period based on the lead time for the item.
