Question 1

One of the main purposes of an MRP system is which of the following?

Accepted Answer

A) Track inventory levels. 
B) Create productive capacity. 
C) Decrease layers of management. 
D) Develop schedules specifying when each component should be ordered or produced. 
E) Upgrade manufacturing's professionalism. 
A) Track inventory levels. 
B) Create productive capacity. 
C) Decrease layers of management. 
D) Develop schedules specifying when each component should be ordered or produced. 
E) Upgrade manufacturing's professionalism.

Question 2

If annual demand is 1,000 units, annual holding cost is $0.50 per unit, and the cost per order is $10, what is the EOQ? ______________________________________

Accepted Answer

200
Explanation: Fro

Question 3

"Projected available balance" is a term referring to unsold finished goods inventory.

Accepted Answer

A) True 
 B)False

Question 4

Time fences are periods of time having some specified level of opportunity for the customer to make changes.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following files allows us to retrace a material requirement upward in the product structure through each level, identifying each parent item that created the demand?

Accepted Answer

A) Planning bill of materials file 
B) Modular bill of materials file 
C) Super bill of materials file 
D) Exception report file 
E) Peg record file 
A) Planning bill of materials file 
B) Modular bill of materials file 
C) Super bill of materials file 
D) Exception report file 
E) Peg record file

Question 6

The lot-for-lot (L4L) lot-sizing technique minimizes carrying cost by taking into account setup costs and capacity limitations.

Accepted Answer

A) True 
 B)False

Question 7

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost, carrying cost, and cost of stockouts.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is one of the main purposes of an MRP system?

Accepted Answer

A) Educate personnel in basic work rules. 
B) Determine the amount of materials needed to produce each end item. 
C) Stimulate the work force. 
D) Decrease labor requirements. 
E) Increase inventory accuracy. 
A) Educate personnel in basic work rules. 
B) Determine the amount of materials needed to produce each end item. 
C) Stimulate the work force. 
D) Decrease labor requirements. 
E) Increase inventory accuracy.

Question 9

The economic order quantity (EOQ) lot-sizing technique produces or acquires exactly the amount of product that is needed each time period with none carried over into future periods.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is not a lot-sizing technique used in MRP systems?

Accepted Answer

A) Lot-for-lot (L4L) 
B) Economic order quantity (EOQ) 
C) Least total cost (LT
C)  
D) Least unit cost (LU
C)  
E) Warehouse loading factor (WLF) 
A) Lot-for-lot (L4L) 
B) Economic order quantity (EOQ) 
C) Least total cost (LT
C)  
D) Least unit cost (LU
C)  
E) Warehouse loading factor (WLF)

Question 11

MRP stands for Material Requirements Planning.

Accepted Answer

A) True 
 B)False

Question 12

The least unit cost method of lot-sizing adds ordering, stockout, and inventory carrying costs for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Accepted Answer

A) True 
 B)False

Question 13

Manufacturing firms maintain bill of materials (BOM) files, which are simply a sequencing of everything that goes into a final product.

Accepted Answer

A) True 
 B)False

Question 14

Net change MRP reflects the exact status of each item managed by the system in "real time."

Accepted Answer

A) True 
 B)False

Question 15

Low-level coding in MRP indicates the exact status of each item managed by the system in "real time."

Accepted Answer

A) True 
 B)False

Question 16

An output of MRP is a bill of materials (BOM) file.

Accepted Answer

A) True 
 B)False

Question 17

Projected available balance is the amount of inventory that is expected as of the beginning of a period.

Accepted Answer

A) True 
 B)False

Question 18

The three main inputs to an MRP system are the bill of materials, the master schedule, and the inventory records file.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is considered a primary report in an MRP system?

Accepted Answer

A) Planned order schedule 
B) Peg report 
C) Planning report 
D) Inventory accuracy report 
E) Aggregate production plan report 
A) Planned order schedule 
B) Peg report 
C) Planning report 
D) Inventory accuracy report 
E) Aggregate production plan report

Question 20

Which of the following is considered a secondary report in an MRP system?

Accepted Answer

A) Planned order schedule 
B) Exceptions reports 
C) Inventory record 
D) Firm orders from known customers 
E) Engineering change reports 
A) Planned order schedule 
B) Exceptions reports 
C) Inventory record 
D) Firm orders from known customers 
E) Engineering change reports

Exam 21: Material Requirements Planning

One of the main purposes of an MRP system is which of the following?

If annual demand is 1,000 units, annual holding cost is $0.50 per unit, and the cost per order is $10, what is the EOQ? ______________________________________

"Projected available balance" is a term referring to unsold finished goods inventory.

Time fences are periods of time having some specified level of opportunity for the customer to make changes.

Which of the following files allows us to retrace a material requirement upward in the product structure through each level, identifying each parent item that created the demand?

The lot-for-lot (L4L) lot-sizing technique minimizes carrying cost by taking into account setup costs and capacity limitations.

The economic order quantity (EOQ) lot-sizing technique uses the "square root formula" to balance setup cost, carrying cost, and cost of stockouts.

Which of the following is one of the main purposes of an MRP system?

The economic order quantity (EOQ) lot-sizing technique produces or acquires exactly the amount of product that is needed each time period with none carried over into future periods.

Which of the following is not a lot-sizing technique used in MRP systems?

MRP stands for Material Requirements Planning.

The least unit cost method of lot-sizing adds ordering, stockout, and inventory carrying costs for each trial lot size and divides by the number of units in each lot size, picking the lot size with the lowest unit cost.

Manufacturing firms maintain bill of materials (BOM) files, which are simply a sequencing of everything that goes into a final product.

Net change MRP reflects the exact status of each item managed by the system in "real time."

Low-level coding in MRP indicates the exact status of each item managed by the system in "real time."

An output of MRP is a bill of materials (BOM) file.

Projected available balance is the amount of inventory that is expected as of the beginning of a period.

The three main inputs to an MRP system are the bill of materials, the master schedule, and the inventory records file.

Which of the following is considered a primary report in an MRP system?

Which of the following is considered a secondary report in an MRP system?

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