CPIM Module 3 D

Which of the following is the most necessary component of an efficient backflushing system? Accurate inventory lead times Regular sales and operations planning meetings Accurate bill of material Accurate forecasts

Accurate bill of material

Material requirements planning (MRP) indicates that safety stock will be dipped into in period 2. The next order will be received in period 3 due to a component availability issue at the supplier. Which of the following actions will most likely occur? No action message from MRP; buyer attempts to expedite order from supplier. Action message to reschedule order from period 3 to period 2; planner temporarily reduces safety stock quantity. No action message generated by MRP, so no action from planner. Action message to reschedule order from period 3 to period 2; planner allows safety stock to be used.

Action message to reschedule order from period 3 to period 2; planner allows safety stock to be used.

Which of the following outputs from material requirements planning is of most use to the rest of the organization for achieving the material plan? Purchase requisitions Action messages Time-phased plan Released orders

Action messages Action messages identify what to do to balance supply and demand. Examples include purchase requisitions, released orders, rescheduling receipts, etc.

Which of the following features is characteristic of continuous process manufacturing? Low-cost production Price as an order-winning criterion Narrow product range All of the above

All of the above

A company packages product in units of 100 per carton. Production yield averages 99%. What is the order quantity transmitted from master production scheduling (MPS) to material requirements planning (MRP) for a period order quantity of 1,000 units? 1,000 1,005 1,010 1,011

1,000 MPS will transmit the required quantity to MRP. MRP would then apply the yield to the order based on existing inventory or safety stock for release to production.

Using phantom bills of material will result in a reduction in: inventory transactions and lot sizes. lot sizes and product structures. product structures and work orders. inventory transactions and work orders.

inventory transactions and work orders. Using phantom bills of material means that subassemblies are noted on the bill of material but are not stocked as assemblies, so they do not require inventory transactions.

What is pegging used for? Displaying the quantity of a component in the bill of material Linking subassemblies with parent items Determining priorities for manufacturing Determining the source of gross requirements

Determining the source of gross requirements

Which of the following actions is taken first to ensure the validity of the material plan in a make-to-stock company? Development of the master production schedule Development of the capacity requirements plan Development of the operations plan Development of the material requirements plan

Development of the master production schedule The master production schedule is the first time in the planning hierarchy that individual products are defined by date and quantity.

A company has a standard product line that is regularly reengineered to reduce cost and improve quality. What must the buyer be most aware of when communicating new replenishment requirements to the supplier? Due date Part cost Order quantity Drawing revision

Drawing revision

In which manufacturing environment is product volume low and product variety high for a given item? Make-to-order Make-to-stock Assemble-to-order Engineer-to-order

Engineer-to-order

Which of the following demand fulfillment approaches typically generates the longest delivery time? Assemble-to-order Make-to-stock Make-to-order Engineer-to-order

Engineer-to-order

A company produces a variety of items with short manufacturing lead times. Which of the following capacity planning techniques would be most useful for bottleneck work centers? Detailed capacity planning Finite capacity planning Bottleneck capacity planning Infinite capacity planning

Finite capacity planning Finite capacity planning maximizes what can be produced.

Which of the following elements is used to reduce system nervousness? Safety stock Planned orders Firm planned orders Economic order quantity

Firm planned orders Firming planned orders allows the planner to make decisions on whether small changes are important enough to react to as well as locking in order quantities and dates for various reasons.

What should a planner use to override the material requirements planning (MRP) logic for the quantity or date of a planned order? Planned order releases Scheduled receipts Firm planned orders Demand time fences

Firm planned orders MRP automatically recalculates planned orders as requirements change. A firm planned order allows the planner to maintain a certain quantity and date to prevent MRP from recalculating.

There is available inventory of 100 units of a component. There are five parent orders that each require 100 of the component, for a total requirement of 500 units. The five end items are being produced to a forecast, and no actual demand is known. Which of the following actions is the planner most likely to do? Expedite the component and release the five orders on their scheduled release dates. Release one of the parent orders on the scheduled date and hold the others. Firm the planned orders of the parents for 20 each and release all five. Wait and see which parent is the first to stock out and release that parent.

Firm the planned orders of the parents for 20 each and release all five. The planner will allocate the available inventory so as to produce some of each parent.

Which of the following statements is true of forecast demand in the master production schedule as it relates to material requirements planning? Forecast demand is ignored within the cumulative lead time. Forecast demand is ignored beyond the cumulative lead time. Forecast demand is treated like any other gross demand. Forecast demand is treated like safety stock replenishment.

Forecast demand is treated like any other gross demand. Demand is demand, no matter what the source.

What determines the frequency with which material requirements should be replanned? Total manufacturing lead time Amount of forecast error Frequency with which requirements and/or priorities change Frequency of bill of material changes

Frequency with which requirements and/or priorities change Material requirements planning (MRP) is used to maintain the priorities of manufacturing and purchase orders. As demand changes, so do the priorities, so MRP should be run to rebalance supply and demand.

Which of the following actions may result in unmanageable backlog? Purchase of single-purpose equipment Increasing available capacity Productivity gains Increasing planned lead time

Increasing planned lead time

Which of the following are prerequisites for a material requirements planning (MRP) system? Routings and stock keeping unit locations Inventory data and bills of material Bills of material and routings Stock keeping unit locations and cycle counts

Inventory data and bills of material MRP uses product structure data as well as available inventory data to determine any imbalance of supply and demand.

Which of the following statements applies to the lot-for-lot batch sizing rule? It generates orders equal to the net requirements for a given number of periods. It generates orders equal to the net requirements in each period. It may be used only with independent demand. It is used for serialized inventory to ensure traceability.

It generates orders equal to the net requirements in each period. Lot-for-lot is a lot-sizing technique that generates planned orders in quantities equal to the net requirements in each period.

In an engineer-to-order environment, what determines the latest point at which the bill of material can be completed and released to material requirements planning? Demand horizon from the master production schedule Point at which the parent bill of material is completed Point at which the final assembly schedule is complete Longest lead time horizon to obtain any required components

Longest lead time horizon to obtain any required components

A make-to-order company has typically employed the fixed-order-quantity approach for its commonly used components. This has resulted in excess inventory over time due to customer changes and new product configurations. The planner should consider which lot-sizing technique to get the problem under control? Economic order quantity Fixed period Lot-for-lot Minimum

Lot-for-lot

Which of the following is a primary advantage of material requirements planning (MRP) over use of the reorder point for determining replenishment order timing in a make-to-order environment? MRP does not need to account for safety stock. MRP uses only actual requirements for order timing. MRP can plan both independent and dependent demand. MRP uses time phasing to balance requirements against supply.

MRP uses time phasing to balance requirements against supply. MRP balances demand against supply; the reorder point replenishes inventory based on a projection of demand.

Which of the following statements about material requirements planning (MRP) and scheduled receipts is true? MRP will neither reschedule nor explode scheduled receipts. MRP will reschedule and explode scheduled receipts. MRP will reschedule but not explode scheduled receipts. MRP will not reschedule but will explode scheduled receipts.

MRP will neither reschedule nor explode scheduled receipts.

Which of the following tools enables a planner to perform bottom-up replanning? Demand time fence Firm planned orders Backorder report Pegging

Pegging

A supplier has notified a buyer that an order for a component will be two weeks late due to a material shortage. Which of the following actions should the material planner take? Identify affected parent orders and reschedule each by two weeks. Perform bottom-up replanning based on pegging and available inventory. Expedite the order to the required date. De-expedite the order to synchronize required dates.

Perform bottom-up replanning based on pegging and available inventory. The planner first needs to identify the effect of a late shipment on parent requirements.

What is the term for consolidated information stored in a single record that contains everything needed to know about a part to plan it effectively? Item master Product data management Product structure Plan for every part (PFEP)

Plan for every part (PFEP)

Which technique facilitates scheduling equipment in economic run lengths and the use of low-cost production sequences? Processor-dominated scheduling Mixed-model scheduling Material-dominated scheduling Mixed-flow scheduling

Processor-dominated scheduling

Which of the following types of orders remain unchanged during a material requirements planning (MRP) run? Planned and firm Released and firm Released and planned None; all orders are changed to reflect a balance of supply and demand.

Released and firm MRP will not automatically change released or firm orders but will still provide action messages if demand and supply are out of balance.

The scheduled receipt in the information provided below represents a purchase order. What would material requirements planning recommend? Reducing the quantity of the order Expediting the order Rescheduling the order to period 2 Rescheduling the order to period 3

Rescheduling the order to period 2 The system would recommend rescheduling to period 2, as there is enough stock on hand to cover both safety stock and gross requirements in period 1. This recommendation may well be ignored by supplier due to the close time frame and the cost associated with rescheduling.

A company has a lean relationship with a supplier. Which of the following should be shared with the supplier for procurement planning over the horizon? Contract Kanban Schedule Purchase order

Schedule A schedule or forecast of future demand can be shared for long-term procurement planning.

It is important for a material planner to know which of the following demand information from the master production schedule? Source Accuracy Quantity Timing

Source

A company that makes products with multiple options is experiencing a temporary increase in sales. Which of the following inventories should be increased? Work in process Finished goods Raw materials Subassemblies

Subassemblies Increasing the subassemblies will allow flexibility to cover demand for various options and maintain lead times.

Which of the following most likely indicates that there are two packing slip errors? The quantity does not match the actual quantity received. The unit price does not match the standard cost on file. The part number does not match the actual material received. The unit of measure does not match the inventory unit of measure.

The part number does not match the actual material received. The incorrect part is received and the correct part is not received, constituting two errors.

Two defective inexpensive parts are discovered in a sample during incoming inspection, but the lot itself is accepted. What is done with the defective parts? They are identified as such and returned to the lot. They are removed and sent to the material review board. They are removed from the lot and disposed of or scrapped. They are removed from the lot and returned to the supplier.

They are removed from the lot and disposed of or scrapped.

What is the primary purpose of the bill of material in material requirements planning (MRP)? To outline the production process in detail To provide costing information To provide a structure for the explosion process To generate a where-used list for all components

To provide a structure for the explosion process MRP uses the bill of material to multiply the requirements by the usage requirements throughout the product structure.

The relationship for all components at the same level in the bill of material to be available at the same time is: a parent-child relationship. a vertical dependency. a horizontal dependency. component availability.

a horizontal dependency. Horizontal dependency is the relationship between components at the same level in the bill of material.

For the purpose of material requirements planning, it is most important for the bill of material to: calculate product cost. be able to balance capacity and load. accurately define part dependencies. be linked to the operation routings.

accurately define part dependencies. Without accurate items and use in the bill of material, the entire explosion and netting process is invalid.

Items that have been assigned to specific orders but have not yet been released from the stockroom to production are referred to as: promised. reserved. allocated. wwork-in-process.

allocated.

An action message indicates that a part needs to be de-expedited by one week, but the buyer opts to not notify the supplier. The supplier shipped to meet the original request date, and the part has a receipt tolerance of required date minus two days and plus zero days. When the supplier's performance is evaluated, the shipment will show as: on time. two days too early. five days too early. This is irrelevant, as only quantity tolerances are rated.

on time.

The validity of the material requirements plan (MRP) is most reliant on the accuracy of the: gross requirements. projected available balance. scheduled receipts. on-hand inventory.

on-hand inventory. The first calculation in the process begins with the on-hand balance.

A firm planned order is used to: override the standard planning parameters that have been defined. manage target inventory levels. schedule a purchase order contract with a supplier. allocate material prior to the release of a customer or shop order.

override the standard planning parameters that have been defined.

Reducing the levels on the bill of material reduces: production reporting activities. work in process. schedule flexibility. material costs.

production reporting activities.

Using a planning horizon shorter than the longest cumulative lead time may result in: a reduction of work in process. a decrease in inventory turns. increased throughput. replenishment orders released with short lead times.

replenishment orders released with short lead times.

An authorization to the purchasing department to purchase specified materials in specified quantities within a specified time is a: request for quote. purchase order. requisition. planned order.

requisition.

Material requirements planning (MRP) may recalculate planned orders as a direct result of changes in: work order receipt dates. capacity. the planning horizon. customer order dates.

work order receipt dates.

The plan for the production and purchase of components used in making items in the master production schedule is the: sales and operations plan. production plan. capacity management plan. material requirements plan.

material requirements plan. The material requirements plan explodes the products from the master production schedule orders to determine the quantities and dates for all manufactured and purchased components.

In a make-to-order environment, what is most likely to be used to convert product demand into material requirements planning over the planning horizon? Customer order forecast Customer order quantity Customer orders Customer order ship dates

Customer order forecast