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Exam 12: MRP and ERP

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Question 31

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Net requirements equal gross requirements minus safety stock.

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Question 32

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A bill of materials contains a listing of all the assemblies, parts, and materials needed to produce one unit of an end item.

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Question 33

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A computer-based information system designed to handle ordering and scheduling of dependent-demand inventories is:

An assembly-time chart indicates gross and net requirements taking into account the current available inventory.

Using the product tree shown, determine the following: (A) the quantity of component K that will be needed to assemble 80 units of P, assuming no on-hand inventory of any components exists. (B) the quantity of component K needed to assemble 80 units of P, given on-hand inventory of 30 A's, 50 B's and 20 C's.

Low level coding represents items less than $18 per unit.

Before a schedule receipt can take place, and order must be placed with a vendor.

The master production schedule states which end items are to be produced, in addition to when and how many.

ERP represents an expanded effort to integrate standardized record-keeping that shares information among different areas of an organization.

Which one of the following is not an input in an MRP system?

MRP is used within most MRP II and ERP systems.

Safety time is sometimes used in MRP rather than safety stock quantities.

MRP II is simply an improved version of MRP that processes faster and can plan for a larger number of end items.

If the firm is using a fixed period lot size of two periods, what is the order size for the first order?

The bill of materials indicates how much material will be needed to produce the quantities on a given master production schedule.

One reason that accurate bills of material are important is that errors at one level become magnified at lower levels because of the multiplication process used by MRP.

Periodic updating of an MRP system to account for all changes which have occurred within a given time interval is called:

One of the primary output reports of MRP concerns changes to planned orders.

Which of the following lot sizing methods does not attempt to balance ordering (or setup) and holding costs?

Which statement concerning MRP II is false?