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Q:
The purpose of supply chain design is to shape a firm's supply chain to meet the competitive priorities of its operations strategies.
Q:
Supply chain management tries to match the flow of materials, services and information with demand.
Q:
The purpose of supply chain management is to synchronize a firm's processes with those of its suppliers and customers.
Q:
12.1 Creating an Effective Supply Chain
Q:
Management wishes to use a POQ lot-sizing rule for an item that experiences an average demand of 30 units per week. If the desired average lot size is 120 units, what should P be?
A) zero or one week
B) two or three weeks
C) four or five weeks
D) more than five weeks
Q:
Use the following MRP record to answer the question. Which one of the statements concerning item LMN is true?
A) The scheduled receipt of 80 units in week 3 should be expedited so that it is finished in week 2.
B) The planned order release quantity in week 3 is 80 units.
C) The planned receipt quantity in week 6 is 30 units.
D) The projected on-hand inventory in week 8 is 70 units.
Q:
Use the following partially completed MRP record to answer the question. What is the planned order release quantity in week 4?
A) 0 units
B) greater than 0 units but fewer than or equal to 50 units
C) greater than 50 units but fewer than or equal to 100 units
D) greater than 100 units
Q:
Use the following partially completed MRP record to answer the question. What are the quantities of planned order releases for item XYZ for the first six weeks (weeks 1, 2, 3, 4, 5, and 6)?
A) 20, 30, 0, 40, 20, 0
B) 35, 0, 60, 0, 0, 0
C) 5, 30, 0, 40, 20, 0
D) 35, 0, 0, 40, 20, 0
Q:
Use the following partially completed MRP record to answer the question. What are the quantities of planned order releases for item ABC for the first five weeks (weeks 1, 2, 3, 4, and 5)?
A) 30, 0, 60, 0, 145
B) 60, 0, 145, 0, 0
C) 0, 30, 60, 0, 0
D) 30, 0, 60, 145, 0
Q:
Which of the following statements about MRP II is best?
A) It is computationally faster than regular MRP.
B) It is limited only to aiding order-launching decisions.
C) It incorporates informal systems through the use of expert systems technology.
D) It provides more extensive information than MRP because it is tied to the company's financial system.
Q:
Which one of the following is a feature of MRP II, but not available in basic MRP systems?
A) financial projections
B) action notices
C) dispatch lists
D) capacity reporting
Q:
Which of the following statements concerning MRP is true?
A) Dependent-demand items tend to experience relatively constant demand rates.
B) MRP systems use independent demands for each component item.
C) Capacity requirements planning (CRP) uses open orders (scheduled receipts) and planned order releases to estimate capacity requirements for critical workstations.
D) The most accurate way to forecast dependent demand is to examine past usage rates.
Q:
Which statement on MRP explosion is best?
A) It calculates the total number of subassemblies, components, and raw materials needed for each parent item.
B) It calculates the total number of raw materials to be purchased from all suppliers.
C) It calculates the total number of parts to be produced for each parent item.
D) It calculates the total number of parts needed to be produced less the number of parts on hand for each parent item.
Q:
Which one of the following is an MRP lot-sizing rule that attempts to minimize the amount of average inventory?
A) periodic order quantity (POQ), with P = 2
B) fixed order quantity (FOQ)
C) economic order quantity (EOQ)
D) lot for lot (L4L)
Q:
Which one of the following statements about lot-sizing rules is true?
A) The periodic order quantity (POQ) rule seeks to create inventory remnants.
B) If the POQ rule is used, an item's lot size can vary each time an order is placed.
C) The lot-for-lot (L4L) rule is a special case of the fixed-order quantity (FOQ) rule.
D) All lot-sizing rules seek to minimize inventory levels.
Q:
If a planned receipt for an item is due in week 6 and the item's lead time is two weeks, in which week will the corresponding planned order release occur?
A) week 2
B) week 4
C) week 6
D) week 8
Q:
Which one of the following is an input to the MRP system?
A) shop-floor schedules
B) financial reports
C) master production schedule
D) purchasing orders
Q:
Which of the following statements about MRP is true?
A) To be classified as a successful MRP user, a company must use either the L4L or POQ rules for lot sizing.
B) MRP gross requirements for a parent item are equal to the planned order releases of its components.
C) MRP logic is based on the logic of uniform, continuous demand, and item independence.
D) MRP gross requirements for a component depend on the planned order releases of its immediate parents.
Q:
MRP II ties MRP to the company's financial system.
Q:
Lot-for-lot (L4L) is a rule that maintains the same order quantity each time an order is issued.
Q:
The periodic order quantity (POQ) rule tends to keep more inventory on hand than the lot-for-lot rule, but less inventory on hand than the fixed order quantity rule.
Q:
For items manufactured in-house, one component of the planned lead time is waiting time.
Q:
Planned receipts are estimates of the amount of inventory available each week after gross requirements have been satisfied.
Q:
An intermediate item must have at least one parent and at least one component.
Q:
A bill of materials (BOM) shows all of the components of an item, the parent-component relationships, usage quantities, and lot size derived from engineering and process designs.
Q:
Gross requirements are the total demand derived from all parent production plans.
Q:
Part commonality tends to increase inventory costs.
Q:
A bill of materials is a record of all the components of an item, the parent-component relationships, and the usage quantities derived from engineering and process designs.
Q:
A materials requirements planning (MRP) explosion occurs when the system is bombarded with too many orders to schedule at one time.
Q:
________ is an estimate of the amount of inventory available each week after gross requirements have been satisfied.
Q:
Operations produces a number of items in one production period. Those items that are not produced for a specific customer order are ________.
Q:
Table 11.2 Mutts Amazing Dogs has developed the following demand forecast for The Pitbull, a spicy concoction graced by pepperjack cheese, serrano, habanero, poblano and jalapeno peppers, onion, and a cilantro-lime aioli. They enter the planning period with 20 hotdogs in inventory as shown in Week 0. A few customers have standing orders for hotdogs and they have booked catering events over the next two months. They buy their hotdogs in packages of ten just like you and me. Week 0 1 2 3 4 5 6 7 8 Forecast 70 80 90 100 120 140 170 220 Customer Orders 80 50 30 10 0 0 0 0 Projected on-hand inventory 20 MPS ATP Use Table 11.2 to answer this question. Mutt decides to operate on a level MPS plan for weeks 1 through 4. What MPS quantity brings them into week 5 with the same ATP as if they had adopted a more traditional approach? A) 190 B) 150 C) 170 D) 160
Q:
Table 11.1 Big Truck Tacos has developed the following forecast of demand and accepted orders for their holiday tacos as they enter the Taco Festival Season. They enter the planning period with 65 holiday tacos in inventory as shown in Week 0. Week 0 1 2 3 4 5 6 7 8 Forecast 70 80 90 100 120 140 170 220 Customer Orders 80 50 30 10 0 0 0 0 Projected on-hand inventory 65 MPS ATP Use Table 11.1 to answer this question. In week 1 the inventory manager discovers, much to his horror, that instead of 65 tacos in inventory, they have only 5 tacos. They had already planned to make exactly what they needed, based on the erroneous inventory number of 65 and they can't alter their week 1 schedule. How many tacos do they need to have on their MPS for the second week of production to correct their shortfall, fulfill backorders, and move forward through the rest of the production period? A) 80 B) 140 C) 100 D) 110
Q:
Available-to-promise (ATP) quantities are only shown in the first period (if the projected on-hand inventory is greater than zero in the first period), and subsequently in periods when the MPS quantity is greater than 0.
Q:
Gross requirements are the total demand derived from all parent production plans.
Q:
The projected on-hand inventory in the MPS takes into account customer orders (booked) as well as the MPS quantities.
Q:
The projected on-hand inventory in the MPS takes into account scheduled receipts, but not planned receipts.
Q:
The portion of the master production schedule farthest into the future is often frozen to reduce forecasting requirements.
Q:
Available-to-promise inventory is the amount of end items that marketing can promise to customers by a certain date.
Q:
The master production schedule (MPS) is the part of the material requirements planning that specifies when components must be ordered or assembled.
Q:
Explain the difference between independent and dependent demand and illustrate your explanation with an example.
Q:
________ is a computerized information system developed specifically to aid in managing dependent-demand inventory and scheduling replenishment orders.
Q:
In MRP, a(n) ________ is an item that may go through one or more operations to be transformed into or become part of one or more parents.
Q:
In MRP, a(n) ________ is any item manufactured from one or more components.
Q:
Under which one of the following circumstances can an MRP system be used to its best advantage?
A) when the item's demand depends only on customer demand
B) when the item's demand is uniform
C) when the item's demand is constant
D) when the item's demand depends on the production plans of its parent(s)
Q:
Any item manufactured from one or more components is a(n):
A) parent.
B) component.
C) intermediate item.
D) purchased item.
Q:
Which of the following is not an example of dependent demand items?
A) shoelaces, shoes
B) wheels, car
C) carafes, coffeemakers
D) ice skates, roller skates
Q:
If the demand for an independent demand item is continuous and uniform, so will the planned order releases of its components.
Q:
A component is an item that may go through one or more operations to be transformed into or become part of one or more parents.
Q:
Dependent demand for an item occurs because the quantity required for it varies with the production plans of one or more parents.
Q:
A parent is any item manufactured from one or more components.
Q:
Material requirements planning (MRP) is a computerized information system developed specifically to aid in managing dependent demand inventory and scheduling replenishment orders.
Q:
11.1 Material Requirements Planning
Q:
Can MRP be adapted for use in services and, if so, how would it work?
Q:
A(n) ________ is a record of a service firm's parent-component relationships with all of the materials, equipment, time, staff, and other productive assets associated with them, including usage quantities.
Q:
The service analogy to the bill of materials in a manufacturing company is the bill of:
A) resources.
B) services.
C) sub-services.
D) tender.
Q:
Facilitating goods in a hotel's bill of resources would include a:
A) housekeeper.
B) fax machine.
C) towel.
D) front-desk clerk.
Q:
An example of a dependent demand item for services is a(n):
A) menu in a restaurant.
B) jukebox in a club.
C) operating suite at a hospital.
D) pilot's checklist for an airline.
Q:
Which of the following statements about service resource planning is true?
A) The service analogy to the BOM in a manufacturing company is a bill of lading (BOL).
B) One resource that every service provider manages is cash.
C) There is no such thing as dependent demand in the service sector.
D) As services are completed, the accounts receivable decrease.
Q:
The bill of resources (BOR) is a record of parent-component relationships and all the required materials, equipment time, staff, and other resources needed, including the usage quantities.
Q:
What is the basic idea behind an enterprise resource planning system?
Q:
What are the differences and similarities among material requirements planning, manufacturing resource planning, and enterprise resource planning systems?
Q:
ERP revolves around a(n) ________.
Q:
A companywide process that cuts across functional areas, business units, geographic regions, and product lines is a(n) ________.
Q:
Which of the following statements about ERP systems is best?
A) Recent studies have shown that the most successful ERP implementations use standardized systems.
B) ERP systems written in XML require complete replacements of a company's legacy systems.
C) A company must adapt their ERP system to their existing processes in order for all employees to gain a benefit from the new system.
D) An ERP system requires a regular synchronization of all of the module databases, which is usually accomplished automatically when the organization is not conducting business.
Q:
Which of the following is a back-office module in a typical ERP system?
A) customer service
B) sales
C) marketing
D) human resources
Q:
A front-office module for an ERP system includes:
A) manufacturing.
B) accounting and finance.
C) sales and marketing.
D) human resources.
Q:
Entering new information in the database of an ERP system is a:
A) data packet.
B) transaction.
C) record.
D) file.
Q:
A companywide process that cuts across traditional functional areas, business units, geographic regions, and product lines is a(n):
A) enterprise process.
B) master production scheduling process.
C) kinetic process.
D) full-business process.
Q:
The companies SAP AG and Microsoft have the largest installed base of customers for ERP packages.
Q:
A firm's existing, older information system is called a "legacy system."
Q:
Companies that fully customize their ERP implementation reap the greatest rewards from such systems since they can continue to use the same processes to which all employees are accustomed.
Q:
An ERP system revolves around a single comprehensive database that is made available across the entire organization.
Q:
Use the bill of materials and inventory records to determine the additional quantities of purchased items necessary to assemble 20 end items if the manufacturer uses lot-for-lot ordering. There are no end items currently on hand, and none of the components have any scheduled receipts. Item
Amount
Item
Amount
Item
Amount O
5
F
17
D
12 P
14
U
3
E
6 C
7
N
10 Inventory amounts indicated in the table are available to produce the end item indicated in this bill of materials.
Q:
Use the bill of materials and inventory records to determine the additional quantities of purchased items necessary to assemble 15 end items if the manufacturer uses lot-for-lot ordering. There are no end items currently on hand, and none of the components have any scheduled receipts. Item
Amount
Item
Amount
Item
Amount O
7
F
11
D
2 P
12
U
7
E
8 C
3
N
12 Inventory amounts indicated in the table are available to produce the end item indicated in this bill of materials.
Q:
Use the bill of materials and inventory records to determine the quantity of purchased items necessary to assemble 20 end items if the manufacturer uses lot-for-lot ordering. There are no end items currently on hand, and none of the components have any scheduled receipts. Component
On-hand
Component
On-hand A
5
D
15 B
75
E
3 C
10
F
20
Q:
How can an MRP system be used in a firm's sustainability efforts?
Q:
Explain why, in a dependent demand environment, MRP does a better job of estimating the need to replenish inventory items than does the reorder point system.
Q:
Explain the key differences between the FOQ, POQ, and L4L lot-sizing rules.
Q:
What information can be gleaned from a bill of materials? If you were asked to produce an item based solely on a copy of its BOM, what missing information would you need?