14: CHAPTER MATERIAL REQUIREMENTS PLANNING
(MRP) AND ERP
TRUE/FALSE
1.
Wheeled Coach obtains competitive advantage through MRP in part because of their
excellent record integrity and insistence on record accuracy.
True (Global company profile, easy)
2.
MRP is generally practiced on items with dependent demand.
True (Dependent demand, easy)
3.
Reduced inventory levels and faster response to market changes are both benefits of MRP.
True (Introduction, easy)
4.
A dependent demand item is so called because its demand is dependent on customer
preferences.
False (Dependent demand, moderate)
5.
The quantity required of a dependent demand item is computed from the demand for
the final products in which the item is used.
True (Dependent demand, moderate)
6.
Since MRP is quite detailed in nature, it has no influence on the longer-range, less
detailed aggregate planning.
False (Dependent inventory model requirements, moderate)
7.
The master production schedule is a forecast of demand for families of products.
False (Dependent inventory model requirements, easy)
8.
Lead times, inventory availability, and purchase orders outstanding are among the
five things operations managers must know for effective use of MRP.
True (Dependent inventory model requirements, easy)
9.
A bill of material lists all components, ingredients, and materials needed to produce one
unit of an end item.
True (Dependent inventory model requirements, moderate)
10.
"Phantom bills" are bills of material for subassemblies that do not exist in reality.
False (Dependent inventory model requirements, easy)
11.
Planning bills of material are bills of material for "kits" of inexpensive items such as
washers, nuts, and bolts.
True (Dependent inventory model requirements, moderate)
12.
The Aggregate Plan, derived from the Master Production Schedule, specifies in more
detail how much of which products is to be made at what times.
False (Dependent inventory model requirements, moderate)
375
13. The time phased product structure, unlike the bill of material, adds the concept of lead
times.
True (Dependent inventory model requirements, moderate)
14.
If X consists of one A and one B, and each A consists of one F and two Gs, then A is the
"parent" component of G.
True (Dependent inventory model requirements, moderate)
15.
If 100 units of Q are needed and 10 are already in stock, then the gross requirement is 100
and the net requirement is 90.
True (MRP structure, easy)
16.
Gross material requirements do not take into account the amount of inventory on hand.
True (MRP structure, easy)
17.
In MRP, a "bucket" refers to a fixed order quantity, such as an EOQ.
False (MRP management, moderate)
18. Time fences divide that segment of the MPS that can be revised from that section that is
"frozen."
True (MRP management, easy)
19.
MRP is an excellent tool for scheduling products with variable lead times.
False (MRP management, easy)
20.
Finite capacity scheduling, unlike MRP, recognizes the capacity limitations of
departments and machines when building schedules.
True (MRP management, easy)
21. If parts and subassemblies common to a variety of products are managed through the
supermarket
concept, formal order releases for such parts are not necessary.
True (MRP management, easy)
22.
The lot-for-lot lot-sizing technique is particularly appropriate when demand is not very
smooth and set up cost is small compared to holding cost.
True (Lot-sizing techniques, moderate)
23.
In general, the lot-for-lot approach should be used whenever economical.
True (Lot-sizing techniques, moderate)
24.
The economic part period is a fraction of a time bucket.
False (Lot-sizing techniques, easy)
25.
The Wagner-Whitin algorithm is the most widely used MRP lot-sizing technique.
False (Lot-sizing techniques, moderate)
26.
MRP can be effective only if very accurate lot sizes are calculated in advance.
False (Lot-sizing techniques, easy)
27.
Smoothing a resource requirements profile to stay within capacity limits may increase setup
costs.
True (Extensions of MRP, moderate)
376
28.
Closed-loop MRP systems allow production planners to move work between time
periods to smooth the load or to at least bring it within capacity.
True (Extensions of MRP, moderate)
29.
Operations splitting sends pieces to the next operation before the entire lot is
completed on the previous operation.
False (Extensions of MRP, moderate)
30.
When safety stock is deemed absolutely necessary, the usual policy is to build it into the
projected on-hand inventory of the MRP logic.
True (MRP structure, moderate)
31.
By convention, the top level in a bill of material is designated level 1.
False (Dependent inventory model requirements, moderate)
32.
DRP is a time-phased stock-replenishment plan for all levels of a distribution network.
True (MRP in services, moderate)
33.
While ERP may provide a strategic advantage over competitors, it is so complex
that many companies cannot adjust to it.
True (Enterprise resource planning (ERP), moderate)
34.
Firms may discover that, rather than adapting ERP to the way they do business, they have
to adapt the way they do business to accommodate the ERP software.
True (Enterprise resource planning, moderate)
35.
The supply chain systems that result from using ERP in the grocery industry are called
efficient consumer response (ECR) systems.
True (Enterprise resource planning (ERP), easy)
MULTIPLE CHOICE
36.
Which of the following statements regarding Wheeled Coach is false?
a. Wheeled Coach has found competitive advantage through
MRP. b. Wheeled Coach builds ambulances in a repetitive
process.
c. Wheeled Coachs MRP system allowed the company to meet tight schedules, but
caused
inventory to rise.
d. Wheeled Coachs MRP system maintains excellent record integrity.
e. Low inventory and high quality are two positive outcomes of Wheeled Coachs use of
MRP.
c (Global company profile, easy)
37.
Demand for a given item is said to be
dependent if a. it originates from the external
customer
b. there is a deep bill of material
c. the finished products are mostly services (rather than goods)
d. there is a clearly identifiable
parent e.
the item has several
children
d (Dependent demand, easy)
377
38.
The phrase "demand related to the demand for other products"
describes a.
a dependent variable
b.
dependent
demand
c. recursive demand
d. regression
analysis
e. independent
demand
b (Dependent demand,
easy)
39.
Dependent demand and independent demand items differ in
that a. for any product, all components are dependentdemand items b. the need for independent-demand items
is forecast
c. the need for dependent-demand items is
calculated
d. All of the above are
true. e. None of the above
is true.
d
(Dependent
demand,
moderate)
40.
A master production schedule specifies
a. the raw materials required to complete the
product b. what component is to be made, and
when
c. what product is to be made, and
when d. the labor hours required for
production
e. the financial resources required for
production
c (Dependent inventory model requirements,
moderate)
41.
The
is (are) the MRP input detailing which end items are to be produced, when
they are needed, and in what quantities.
a. master
production
schedule
b. gross
requirements c.
inventory records
d.
assembly time
chart
e. bill
of
material
a (Dependent inventory model requirements,
moderate)
42.
A master production schedule contains information about
a. quantities and required delivery dates of all
subassemblies b. quantities and required delivery dates
of final products
c. inventory on hand for each
subassembly d. inventory on hand for
each final product e. scheduled
receipts for each final product
b (Dependent inventory model requirements,
moderate)
43.
The aggregate plan gets input or feedback from which of the following areas?
a.
engineering
b. finance, marketing, and human
resources c. the master production
schedule
d. procurement, production, and general
management e. all of the above
e (Dependent inventory model requirements,
easy)
378
4 4.
In continuous (make-to-stock) operations, the master production schedule is usually
expressed in terms of
a. end items
b.
modules c.
kits
d. customer orders
e. warehouse orders
a (Dependent inventory model requirements, moderate)
45.
In job shop (make-to-order) operations, the master production schedule is usually
expressed in a. end items
b. modules
c. kits
d. customer orders
e. warehouse orders
d (Dependent inventory model requirements, moderate)
46.
The following table is an example of a(n)
Week 1
Clothes Washer
Clothes Dryer
Upright Freezer
300
Week 2
200
100
Week 3
100
200
Week 4
100
Week 5
100
500
a. aggregate
plan b. load
report
c. master production schedule
d. capacity plan
e. inventory record
c (Dependent inventory model requirements, moderate)
47.
A document calls for the production of 50 small garden tractors in week 1; 50 small garden
tractors and 100 riding mowers in week 2; 100 riding mowers and 200 garden utility carts
in week 3; and
100 riding mowers in week 4. This document is most likely a(n)
a. net requirements document
b. resource requirements
profile c.
aggregate plan
d. master production schedule
e. Wagner-Whitin finite capacity document
d (Dependent inventory model requirements, moderate)
48.
The
is the input to material requirements planning which lists the
assemblies, subassemblies, parts, and raw materials needed to produce one unit
of finished product. a. bill of material
b. master production schedule
c. inventory records
d. assembly time chart
e. net requirements chart
a (Dependent inventory model requirements, moderate)
379
4 9.
A bill of material lists the
a. times needed to perform all phases of
production b. production schedules for all
products
c. components, ingredients, and materials required to produce
an item d. operations required to produce an item
e. components, ingredients, materials, and assembly operations required to produce
an item
c (Dependent inventory model requirements,
moderate)
50.
Firms making many different final products use
to facilitate production
scheduling. a.
planning bills
b.
modular
bills c. phantom
bills
d.
overdue bills
e. none of the
above
b (Dependent inventory model requirements,
moderate)
51.
A bill of material must be updated with the corrected dimensions of a part. The
document that details this change is a(n)
a. modular
bill
b.
engineering change
notice
c. resource
requirements
profile
d. lead time-offset product structure
document e. planning bill
b (Dependent inventory model requirements,
easy)
52.
The bill of material contains information
necessary to a. place an order to replenish the
item
b. calculate quantities on hand and on
order
c. convert net requirements into higher level gross
requirements d. convert gross requirements into net
requirements
e. convert (explode) net requirements at one level into gross requirements at the
next level
e (Dependent inventory model requirements,
moderate)
53.
Which of the following statements best compares modular bills and phantom bills?
a. Both pertain to assemblies that are not
inventoried. b. There is no difference between
the two.
c. Both pertain to assemblies that are
inventoried.
d.
Modular bills are used for assemblies that are not inventoried, unlike
phantom bills.
e. Modular bills represent subassemblies that actually exist and are inventoried, while
phantom bills represent subassemblies that exist only temporarily and are not
inventoried.
e (Dependent inventory model requirements,
moderate)
54.
The minimum record accuracy required for successful MRP is
approximately a.
lower than 90%
b.
90%
c. 95%
d.
97% e.
99%
e (Dependent inventory model requirements,
moderate)
380
55. Given the following bill of material
If the demand for product A is 50 units, what will be the gross requirement for
component E?
a. 4
b. 100
c. 200
d. 250
e. 300
e (Dependent inventory model requirements, moderate) {AACSB: Analytic
Skills}
56. Given the following bill of material
If the demand for product A is 50 units, what will be the gross requirement for
component E?
a. 50
b.
100 c.
150
d.
200 e.
300
a (Dependent inventory model requirements, moderate) {AACSB: Analytic
Skills}
381
5 7.
When safety stock is deemed absolutely necessary, the usual policy is to build it
into which category of the MRP logic?
a. Gross Requirements
b.
Scheduled
Receipts
c.
Projected
On
Hand d.
Net
Requirements
e. Planned Order Receipts
c (MRP structure, moderate)
58.
Given the following bill of
material
If the demand for product A is 30 units, and there are 10 units of B on hand and none of
C, how many units of part D will be needed?
a. 3 b.
40 c.
70
d. 90
e. 110
c (Dependent inventory model requirements, difficult) {AACSB: Analytic Skills}
59.
Low level coding means
that
a. a final item has only a few levels in the BOM
structure b. it is the code for the lowest level in the
BOM structure
c. a component item is coded at the lowest level at which it appears in the BOM
structure
d. the top level of the BOM is below level zero and that BOMs are not organized
around the finished product
e. none of the above
c (Dependent inventory model requirements, moderate)
382
60. Each X requires 2 of component Y; each Y requires 4 of part Z. The lead time for assembly
of X is
1 week. The lead time for the manufacture of Y is 1 week. The lead time for the
procurement of Z
is 6 weeks. The cumulative lead time for X is weeks.
a. 6
b. 7
c. 8
d.
10
e. cannot
be
determined
c (MRP structure, moderate) {AACSB: Analytic
Skills}
61.
A material requirements plan contains information with regard to all of the following except
a. quantities and required delivery dates of all
subassemblies b. quantities and required delivery dates
of final products
c. the capacity needed to provide the projected output
rate d. inventory on hand for each final product
e. inventory on hand for each
subassembly
c
(MRP
structure,
moderate)
62.
Each R requires 2 of component S and 1 of part T. The lead time for assembly of R is 3
days. The lead time for the manufacture of S is 5 days. The lead time for the manufacture
of T is 10 days. The cumulative lead time for R is
days.
a. 6
b. 9
c. 13
d.
17
e. cannot
be
determined
c (MRP structure, moderate) {AACSB: Analytic
Skills}
63.
Each R requires 4 of component S; each S requires 3 of part T. The lead time for assembly
of R is 1 week. The lead time for the manufacture of S is 2 weeks. The lead time for the
procurement of T is
6 weeks. The cumulative lead time for R is
weeks. a.
6
b.
9
c. 12
d. 18
e. 28
b (MRP structure, moderate) {AACSB: Analytic
Skills}
64.
Which of the following best describes a gross material requirements plan?
a. a schedule that shows total demand for an item, and when it must be ordered from a
supplier or when production must be started
b. an intermediate range plan for the scheduling of families of
products
c. a chart illustrating whether capacity has been
exceeded
d. a table that corrects scheduled quantities for inventory on
hand
e. a schedule showing which products are to be manufactured and in what
quantities
a
(MRP
moderate)
structure,
383
6 5.
Which of the following statements regarding the gross material requirements plan is true?
a. It shows total demand for an
item.
b. It shows when an item must be ordered from a supplier or when production must be
started. c.
It combines a master production schedule with the time-phased
schedule.
d. It requires several inputs, including an accurate bill of
material. e.
All of the above are true.
e
(MRP
structure,
moderate)
66. The MPS calls for 110 units of Product M. There are currently 30 of Product M on hand.
Each M
requires 4 of Component N. There are 20 units of N on hand. The net requirements
for N are a.
150
b.
170
c. 300
d. 320
e. 440
c (MRP structure, moderate) {AACSB: Analytic
Skills}
67. The MPS calls for 50 units of Product A and 60 of B. There are currently 25 of Product B
on hand.
Each A requires 2 of Part C; each B requires 5 of C. There are 160 units of C available.
The net requirements for C are
a. 115
b. 175
c. 240
d. 690
e. 700
a (MRP structure, difficult) {AACSB: Analytic
Skills}
68. The MPS calls for 110 units of Product A. There are currently 60 of Product A on hand.
Each A
requires 4 of Part B. There are 20 units of B available. The net requirements
for B are a.
20
b. 120
c. 180
d. 240
e. 440
c (MRP structure, moderate) {AACSB: Analytic
Skills}
69.
In MRP record calculations, the appearance of a negative value for the gross
requirements of an end item in a specific time bucket
a. signals the need to purchase that end item in that
period
b. implies that value was scheduled by the
MPS
c. signals the need for a negative planned order receipt in that
period d. is impossible
e. All of the above are
true.
d
(MRP
moderate)
structure,
384
7 0.
The number of units projected to be available at the end of each time period
refers to a.
net requirements
b.
scheduled
receipts
c. the projected usage of the
item
d. the amount projected to be on
hand
e. the amount necessary to cover a
shortage
d
(MRP
structure,
moderate)
71.
Linking a part requirement with the parent component that caused the requirement is
referred to as a.
net requirements planning
b. a time
fence c.
pegging
d. kanban
e.
leveling
c
(MRP
moderate)
72.
management,
In MRP, system nervousness is caused
by
a. management's attempt to continually respond to minor changes in production
requirements b. the use of the lot-for-lot approach
c. management's marking part of the master production schedule as "not to be
rescheduled" d. the use of phantom bills of material
e. management's attempt to evaluate alternative plans before making a
decision
a
(MRP
management,
moderate)
73. One of the tools that is particularly useful in reducing the system nervousness in the MRP
system is
(are
)
a. modular
bills b.
time
phasing
c.
time fences
d.
lot
sizing
e. closed
loop
system
c
(MRP
management,
moderate)
7 4.
75.
Distortion in MRP systems can be minimized when safety stock is held
at the a. purchased component or raw material level
b.
work-in-process
level
c. finished goods
level d. a and b
e. a and
c
e
(MRP
structure,
difficult)
Material requirements plans
specify
a. the quantities of the product families that need to be
produced b. the quantity and timing of planned order
releases
c. the capacity needed to provide the projected output
rate
d. the costs associated with alternative
plans
e. whether one should use phantom bills of material
or not
b
(MRP
moderate)
structure,
385
7 6.
Which of the following best differentiates material requirements planning (MRP)
from finite capacity scheduling (FCS)?
a. FCS recognizes the finite nature of capacity while MRP does not.
b. FCS works in services while MRP does not.
c. MRP requires time buckets while FCS does
not. d. FCS is an input into traditional MRP
systems.
e. FCS uses the Wagner-Whitin algorithm while MRP uses lot-for-lot and EOQ.
a (MRP management, moderate)
77.
Which of the following lot-sizing techniques results in the lowest holding costs?
a. lot-forlot b. EOQ
c. part-period balancing
d. Wagner-Whitin algorithm
e. the quantity discount model
a (Lot-sizing techniques, moderate)
78. Which of the following statements is true about the MRP plan when using lot-for-lot
ordering?
a. The quantity of gross requirements for a child item is always equal to the quantity of
planned order releases for its parent.
b. The quantity of gross requirements for a child item is equal to the quantity of planned
order
release(s) multiplied by the number of child items used in the parent
assembly.
c. The quantity of gross requirements for a child item is always equal to the quantity
of gross requirements for its parent.
d. The quantity and gross requirements for a child item is always equal to the
quantity of net requirements for its parent.
e. All of the above are true.
b (MRP structure, moderate)
79. What lot-sizing technique is generally preferred when inventory holding costs are
extremely high?
a. lot-forlot b. EOQ
c. part-period balancing
d. the Wagner-Whitin algorithm
e. All of the above are appropriate for the situation.
a (Lot-sizing techniques, moderate)
80.
For the lot-sizing technique known as lot-for-lot to be
appropriate a. future demand should be known for several
weeks
b. setup cost should be relatively
small c. annual volume should be
rather low
d. item unit cost should be relatively small
e. the independent demand rate should be very stable
b (Lot-sizing techniques, moderate)
386
81.
82.
An item's holding cost is 60 cents per week. Each setup costs $120. Lead time is 2
a. .005
b. 60
c. 72
d. 100
e. 200
e (Lot-sizing techniques, moderate) {AACSB: Analytic Skills}
Which of the following statements regarding lot-sizing is
true? a.
EOQ principles should be followed
whenever economical. b. Too much concern with lotsizing results in false accuracy.
c. Lot-for-lot cannot be modified for scrap allowance or process constraints.
d. The Wagner-Whitin algorithm simplifies lot size
calculations. e. All of the above are true.
b (Lot-sizing techniques, moderate)
83. A firm makes numerous models of mowers, garden tractors, and gasoline powered utility
vehicles.
Some assemblies and parts are common to many end items. To relieve the MPS of
performing order releases on these common parts, the firm might choose to use the
technique. a.
WagnerWhitin
b. economic part period
c. supermarket
d. gross material requirements
e. resource requirements profile
c (MRP management, moderate)
84.
Capacity planning in closed-loop MRP
a. utilizes feedback about workload from each work center
b. may make use of resource requirements profiles (load reports)
c. may smooth work center loads with such tactics as overlapping and lot
splitting d. does not add capacity, but rather seeks effective use of existing
capacity
e. All of the above are true.
e (Extensions of MRP, moderate)
85.
If a load report (resource requirements profile) shows a work center scheduled beyond
capacity a.
the company must add capacity by enlarging the facility
b. the company must add capacity by such tactics as overtime and subcontracting
c. the work center's load may be smoothed by such tactics as operations splitting or lot
splitting d. the aggregate plan must be revised
e. the Wagner-Whitin algorithm should be used to rebalance the load
c (Extensions of MRP, moderate)
86.
MRP II is accurately described as
a. MRP software designed for services
b. MRP with a new set of computer programs that execute on
microcomputers c.
MRP augmented by other resource variables
d. an enhancement of MRP that plans for all levels of the supply chain
e. a new generation of MRP software that extends MRP to planning and scheduling
functions
c (Extensions of MRP, moderate)
387
8 7.
The extension of MRP which extends to resources such as labor hours and machine
hours, as well as to order entry, purchasing, and direct interface with customers and
suppliers is
a. MRP
II
b.
enterprise resource
planning
c. the master production
schedule d. closed-loop MRP
e. not
yet
technically
possible
b (Extensions of MRP,
moderate)
88.
Which of the following statements regarding MRP in services is true?
a. MRP is for manufacturing only, and is not applicable to
services.
b. MRP can be used in services, but only those that offer very limited
customization. c.
MRP does not work in services because there is no
dependent demand.
d. Services such as restaurant meals illustrate dependent demand, and require product
structure trees, bills-of-material, and scheduling.
e. None of the above is
true.
d (MRP in services,
moderate)
89.
Distribution resource planning
(DRP) is
a. a transportation plan to ship materials to
warehouses
b. a time-phased stock replenishment plan for all levels of a distribution
network c.
a shipping plan from a central warehouse to retail
warehouses
d. material requirements planning with feedback loop from distribution
centers e.
a material requirements planning package used
exclusively by warehouses
b (MRP in services,
moderate)
90.
By convention, the top level in a bill of
material is a. level 0
b. level 1
c. level T
d.
level
10
e. level
100
a (Dependent inventory model requirements,
moderate)
9 1.
Enterprise resource planning (ERP)
a. seldom requires software upgrade or
enhancement
b. does not integrate well with functional areas other than
operations c. is inexpensive to implement
d. automates and integrates the majority of business
processes
e. all of the
above
d (Enterprise resource planning (ERP),
moderate)
92.
Enterprise resource planning (ERP)
a. has been made possible because of advances in hardware and
software b.
uses client/server networks
c. creates
commonality
of
databases
d. uses business application-programming interfaces (BAPI) to access their
database e.
All of the above are true of ERP.
e (Enterprise resource planning (ERP), moderate) {AACSB: Use
of IT}
388
93.
Which of the following is false concerning enterprise resource planning
(ERP)?
a. It attempts to automate and integrate the majority of business
processes. b. It shares common data and practices across the
enterprise.
c. It is inexpensive to implement.
d. It provides and accesses information in a real-time
environment. e.
All of the above are true.
c (Enterprise resource planning (ERP), moderate)
94.
Which of the following regarding enterprise resource planning (ERP) is true?
a. It involves an ongoing process for implementation.
b. It can incorporate improved, reengineered "best
processes." c. It has a software database that is off-theshelf coding.
d. ERP systems usually include MRP, financial and human resource
information. e. All of the above are true.
e (Enterprise resource planning (ERP), moderate)
95.
All of the following are advantages of enterprise resource planning (ERP)
except it a.
creates commonality of databases
b. increases communications and collaboration
worldwide c. helps integrate multiple sites and
business units
d. requires major changes in the company and its processes to implement
e. can provide a strategic advantage over competitors
d (Enterprise resource planning (ERP), moderate) {AACSB: Communication}
FILL-IN-THE BLANK
96.
Wheeled Coach uses
as the catalyst for low inventory, high quality,
tight schedules, and accurate records.
material requirements planning or MRP (Global company profile, easy)
97.
is a dependent demand technique that uses a bill of material, inventory,
expected receipts, and a master production schedule to determine material requirements.
Material requirements planning or MRP (Dependent demand, easy)
98.
A(n)
is a timetable that specifies what is to be made and when.
master production schedule or MPS (Dependent inventory model requirements, easy)
99.
A(n)
is a listing of the components, their description, and the quantity
of each required to make one unit of a product.
bill of material or BOM (Dependent inventory model requirements, moderate)
100. A process focus facility (for example, a print shop) will likely schedule
focus of its master production schedule.
orders (Dependent inventory model requirements, easy)
as the
101. Bills of material organized by major subassemblies or by product options are called
.
modular bills (Dependent inventory model requirements, moderate)
389
102. The
is used to correct an erroneous dimension, quantity, or other
specification in a bill of material.
engineering change notice (Dependent inventory model requirements, easy)
103.
is a bill of material for components, usually assemblies that
exist only temporarily; they are never inventoried.
Phantom bill of material (Dependent inventory model requirements, moderate)
104.
are the result of adjusting gross requirements for inventory on hand and
scheduled receipts.
Net material requirements (MRP structure, moderate)
105.
are way a of allowing a segment of the master schedule to be designated as
"not to be rescheduled."
Time fences (MRP management, moderate)
106.
, unlike MRP, recognizes that departments and machines have limitations
on their capacity that must be observed if the schedule is to be realistic.
Finite capacity scheduling or FCS (MRP management, easy)
107.
refers to the time units in a material requirements planning (MRP) system.
Buckets (MRP management, easy)
108.
plan.
is a lot-sizing technique that generates exactly what was required to meet the
Lot-for-lot (Lot-sizing techniques, moderate)
109. The
technique may be applicable where a firm's parts and
subassemblies are common to a variety of its products.
supermarket (MRP management, easy)
110. A(n)
provides feedback to the capacity plan, master production
schedule, and production plan so planning can be kept valid at all times.
closed-loop MRP system (Extensions of MRP, moderate)
111. A(n)
can illustrate whether a work center has been scheduled beyond its
capacity.
load report or resource requirement profile (Extensions of MRP, easy)
112.
is a system that allows, with MRP in place, inventory data to be augmented
by other resource variables.
Material requirements planning II or material resource planning or MRP II
(Extensions of
MRP, moderate)
113. A(n)
system is packaged business software that automates and
integrates the majority of their business processes, shares common data and practices
across the entire enterprise, and produces and accesses information in a real-time
environment.
enterprise resource planning or ERP (Enterprise Resource Planning (ERP), moderate)
{AACSB: Use of IT}
390
SHORT ANSWERS
114. Describe the role of record accuracy in Wheeled Coachs successful use of MRP. Is this
company's experience the exception or the rule? Answer in a well-developed paragraph.
Wheeled Coachs record integrity is excellent. They have accurate bills of material
and of inventory; they use cycle counters for material audits and error detection.
Record accuracy is
recognized as a fundamental ingredient of successful MRP implementation. Thus
Wheeled
Coachs excellent record integrity is expected; they would not have successful use of
MRP
without it. (Global company profile, easy)
115. What is MRP? Identify four benefits from its use.
MRP or material requirements planning is a dependent demand technique that uses
a bill of material, inventory expected receipts, and a master production schedule to
determine material requirements. The benefits of MRP include better response to
customer orders, faster response to market changes, improved utilization of facilities
and labor, and reduced inventory levels. (Introduction and Dependent demand, easy)
116. How does the process choice of an organization affect the basis of its master production
schedule?
In a continuous focus (make-to-stock) company, the MPS will likely be expressed in
end items; in a process focus (make-to-order) company, customer orders will likely be
the basis of the MPS; and in a repetitive process (assemble-to-stock) company, the
basis will be its modules. (Dependent inventory model requirements, moderate)
117. If the explosion of the bill of material tells MRP how much of each part is needed, how
does MRP
learn when each of these parts is needed?
Timing is established with the time-phased product structure, which factors item
quantities with item lead times. The lead times are cumulative, in the sense that the
lead time for a child part is the sum of its lead time and that of all of its parent
components. (Dependent inventory model requirements, moderate)
118. Explain the difference between a gross requirements plan and a net requirements plan.
A gross requirements plan multiplies each part quantity in the bill of material by the
number of top level parents needed. This ignores any inventory on hand, whether of
parents or children. A net requirements plan starts with the top level requirements
from the bill of material, then subtracts inventory of that item on hand. This net
requirement becomes the gross requirement to the next level of the product structure.
(MRP structure, easy)
119. Describe briefly the information requirements of basic and extended MRP systems.
Comment on the challenge of maintaining timely, accurate information for a large
manufacturing operation based on MRP.
MRP requires very high accuracy of inventory data file. MRP needs inputs from the
master
production schedule, bills of material, inventory records, and expected receipts. As
MRP is extended to MRP II and ERP, the information needs are intensified. (MRP
structure and Extensions of MRP, moderate)
391
120. What information is necessary for an operations manager to make effective use of a
dependent inventory demand model?
The information necessary for an operations manager to make effective use of a
dependent
inventory demand model are the master production schedule (what is to be made, and
when); specifications or bills of material (how to make the product); inventory
availability (what is in stock); purchase orders outstanding (what is on order); and
lead times (how long does it take to get or make each component). (MRP structure,
moderate)
121. A working MRP system allows a firm to react to even minor changes in production
requirements.
Discuss both the advantages and disadvantages of having such ability.
The advantages are it allows the firm to react quickly and, conceivably, to minimize
costs. The disadvantages are the reaction to a large number of minor changes may
introduce instability (nervousness) into the purchasing and production
departments. (MRP structure, moderate)
122. An error has been detected in the technical drawing of a product about to be placed on a
master production schedule. The part should be 9" by 12", not 9 cm by 12 cm; further,
the part should be stainless steel, not ordinary steel. What document transmits the needed
change? Where is the corrected information recorded? Why is this important to the
master production schedule?
An engineering change notice or ECN is the document that corrects the error; the
correction is made on the bill of material for that product. Accurate records are a
necessity for successful use of MRP. In this case, the wrong part would be made or
purchased, then sent to assembly. The product could not be correctly made, the
schedule could not be met, and the customer's order could not be delivered.
(Dependent inventory model requirements, moderate)
123. What are time fences? Why are they used?
Time fences allow a segment of the master schedule to be designated as "not to be
rescheduled." They are used to reduce system nervousness in MRP environments.
(MRP management, moderate)
124. Explain what is meant by "nervousness" of the MRP schedule. Provide an example.
Name two tools that are particularly useful in reducing system nervousness in MRP
systems. Nervousness is the reaction to a large number of minor changes that may
introduce
instability into the purchasing and production departments. Two tools for reducing
system nervousness are time fences and pegging. (MRP management, moderate)
125. Describe finite capacity scheduling. How is it more realistic than MRP?
FCS provides the precise scheduling needed for rapid material movement. MRP
schedules work without regard to capacity. Finite capacity scheduling factors
department and machine capacity into its scheduling, and is thus more realistic than
MRP. (MRP and JIT, easy)
126. What is the "supermarket" as it is used in MRP? How does it alter the responsibility
for dealing with lead-time offsets?
The supermarket concept applies when parts and assemblies are common to various
end
items. These items are inventoried in the supermarket so that the master production
scheduler does not issue order releases for them. These parts can simply be picked
up, and have no lead time. Maintaining the supermarket is done through kanban
methods, not MRP. (MRP management, moderate)
392
127. You have seen several methods for lot sizing in MRP. Why is lot sizing important in
MRP? Can too much concern be given lot sizing? Answer in a well-developed
paragraph.
Lot sizing is important because, at the very least, it impacts costs. But too much
attention can
be paid to lot sizing, which can result in false accuracy. Also, several lot-sizing
methods may all produce satisfactory results. Finally, proper lot size is often not
possible to determine until after actual requirements are known. (Lot-sizing
techniques, moderate)
128. What does the part-period balancing lot-sizing technique attempt to do in deciding the lot
sizes?
It balances the setup and holding costs. PPB uses additional information by changing
the lot size to reflect requirements of the next lot size in the future. (Lot-sizing
techniques, moderate)
129. Describe how MRP II differs from MRP.
MRP II is MRP in which inventory data are augmented by labor hours, material
cost, capital cost, or by virtually any resource. (Extensions of MRP, moderate)
130. How can MRP and JIT be effectively integrated?
One approach is the small bucket approach that involves the following steps:
1. Reduce the MRP buckets from weekly to daily to perhaps hourly.
2. The planned receipts that are part of a firms planned orders in an MRP
system are communicated to the work areas and are used to sequence
production.
3. Inventory is moved through the plant on a JIT basis.
4. As products are completed, they are moved into inventory in the normal way.
5. A back flush is used to reduce inventory balances.
Another approach is the balanced flow. In this system, execution is achieved by
maintaining a carefully balanced flow of materials to assembly areas with small lot
sizes.
(MRP management, difficult)
131. Identify the several lot-sizing algorithms used in MRP. Provide at least one advantage
and one disadvantage of each.
(Lot-sizing techniques, moderate)
132. Describe the tactics for load smoothing in MRP.
Overlapping - send pieces to the second operation before the entire lot is
completed on the first operation; operations splitting - send the lot to two different
machines for the same operation; and lot splitting - break up the order and run
part of it ahead of schedule. (Extensions of MRP, moderate)
393
133. What do we mean by closed-loop MRP?
Closed-loop MRP indicates that (a) there is both a planning and execution phase,
and (b) information from the execution phase is fed back to the planning phase.
Once planning is complete, an attempt is made to execute the planned schedule.
Information is fed back from the execution of this schedule to the planning phase
so the plans can be modified as necessary. (Extensions of MRP, moderate)
134. What types of resources might be scheduled via an MRP II system?
Virtually all resources can be evaluated via MRP II. This includes material, labor,
cash, and facilities. (Extensions of MRP, moderate)
135. What is DRP?
DRP is a time-phased stock replenishment plan for all levels of a distribution network.
(MRP
in services, moderate)
136. Compare MRP in services to MRP in manufacturing. Utilize a simple example in your
comparison.
Services can exhibit dependent demand, just like parts and assemblies in
manufacturing. Such services can require product structure trees, bills of material,
bills of labor, and scheduling. These are the same features that make MRP
attractive to manufacturers. Examples will vary, but here is a sample drawn from
food service. One can construct a product structure tree and bill of material for a
restaurant meal; lead time offsets are vital; otherwise the elements of the meal
would not be served in the right order or at the proper temperature. (MRP in
services, moderate)
137. What does enterprise resource planning (ERP) allow an organization to do?
It allows them to automate and integrate the majority of their business processes,
to share common data and practices across the entire enterprise, and to produce
and access information in a real-time environment. (Enterprise resource planning
(ERP), moderate)
{AACSB: Use of IT}
138. What are the advantages of enterprise resource planning (ERP)?
ERP provides integration of the supply chain, production, and administrative
processes; creates commonality of databases; incorporates improved, redesigned, or
"best" practices; increases communication and collaboration worldwide; helps
integrate multiple sites and business units; comes with software core that is off-theshelf coding; and provides a strategic advantage over competitors. (Enterprise
resource planning (ERP), moderate) {AACSB: Use of IT}
139. What are the disadvantages of enterprise resource planning (ERP)?
ERP is very expensive to purchase, and even more costly to customize; requires
major changes in the company and processes to implement; is such a complex
program that many companies cannot adjust to it; involves an ongoing process for
implementation, often never completed; and expertise in ERP is limited, with
staffing an ongoing problem. (Enterprise resource planning (ERP), moderate)
{AACSB: Use of IT}
394
PROBLEMS
140. Consider the following bill of material. Fifty units of Product A are needed. Assuming no
on-hand inventory, and no scheduled receipts, explode the bill of material.
A
B(2)
D
C(3)
D
E(2)
Item A: 50 units; Item B: 50 * 2 = 100 units; Item C: (50 * 3) = 150 units; Item D: (50
* 2 * 1)
+ (50 * 3 * 1) = 250 units; Item E: (50 *3 * 2) = 300
units. (MRP structure, moderate) {AACSB:
Analytic Skills}
395
141. The large parts of a playground A-frame (from which to hang a swing or glider) consist of
a ridge pole, four legs, and two side braces. Each pair of legs fastens to the ridge with one
fastener set. Each side brace requires two fastener sets for attachment to the legs. Each
fastener set includes one zinc-plated bolt, one lock-washer, and one nut.
There is one order outstanding, to make 80 frame kits. There are 200 legs in inventory.
There are no other large items in inventory, and no scheduled receipts. Fasteners are
available from the small parts area.
a. Draw the product structure tree
b. Calculate the net requirements to fulfill the outstanding order.
Solution:
A-frame
Ridge pole
Side braces
(2)
Legs (4)
Fastener set
Fastener set
(2)
(1)
(1)
A-frame
80
80
Part
GR
OH
Ridge pole
80
80
Side braces
160
160
Legs
320
200
120
Fastener set
440
440
(MRP structure, easy) {AACSB: Analytic Skills}
396
142. A very simple product (A) consists of a base (B) and a casting (C). The base consists of a
plate (P) and three fasteners (F). There are currently 30 castings and 100 bases on hand.
Final assembly takes one week. The casting has a lead time of three weeks. All other parts
have one week lead times. There are no scheduled receipts. All components are lot for lot.
The MPS requires 80 units of product A in week 5 and 120 in week 8. Produce the MRP
for the upcoming eight weeks. Produce a list of all planned order releases.
Indented Bill of Material
Item name
A
B
P
F
C
Number
Indented
per
parent
Level
0
1
2
2
1
Distinct items
1
1
1
3
1
BOM
A
B
P
F
C
5
Lead
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
B
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
C
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
0
0
0
0
Safety
0
0
0
0
0
0
0
0
Minimum
0
0
0
80
0
80
80
0
0
0
0
0
0
0
0
120
0
120
120
0
time
1
Stock
0
Lot size
1
quantity
0
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
80
0
0
120
0
100
100
0
0
0
100
0
0
0
100
0
0
0
100
0
0
0
20
0
0
0
20
0
0
100
20
100
100
0
0
0
0
0
time
3
Stock
0
Lot size
1
quantity
0
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
80
0
0
120
0
30
30
0
0
50
30
0
0
0
30
0
0
0
397
30
50
50
120
0
0
0
0
0
0
0
0
0
120
120
0
0
0
0
0
P
Gross requirements
NETePOQ Req
Sch duled receipts
Planned receipts
Planned orders
Lead
Safety
Minimum
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
0
0
100
0
0
0
0
0
0
0
100
0
0
0
0
0
0
0
100
0
0
0
0
0
0
100
0
0
0
Gross requirements
NET duled receipts
SchePOQ Req
Planned receipts
Planned orders
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
0
0
300
0
0
0
0
0
0
0
300
0
0
0
0
0
0
0
300
0
0
0
0
0
0
300
0
0
0
(MRP structure, moderate) {AACSB: Analytic Skills}
143. Consider the following requirements for a certain product.
Period
Gross requirements
1
0
2
200
3
200
4
500
5
0
6
400
7
0
8
400
Beginning inventory = 500 units
Setup cost = $500 per setup
Lead time = 1 week
Holding cost = $3 per unit per
week a. Develop the lot-for-lot
MRP table. b. Calculate the total
relevant cost.
There are three setups at $500 each, totaling $1,500. There are 500 units held in period
1 and
2, and 300 in period 3. The holding costs are 1300 units x $3 per unit, for a total of
$3,900. Total relevant costs are $5,400.
Safety
Minimum
quantity
0
Stock
0
Lot size
1
Lead time
1
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
Gross requirements
0
200
200
500
0
400
0
400
Scheduled receipts
On Hand Inventory
500
500
500
300
100
0
0
0
0
NET POQ Req
0
0
0
400
0
400
0
400
Planned receipts
0
0
0
400
0
400
0
400
Planned orders
0
0
400
0
400
0
400
0
A
(Lot-sizing techniques, easy) {AACSB: Analytic Skills}
398
144. Consider the following bill of material. Fifty units of Product A are needed. Assuming no
on-hand inventory, explode the bill of material.
Item A: 50 units; Item B: 50 * 1 = 50 units; Item C: (50 * 2) = 100 units; Item D: (50 *
2 * 1) + (100 * 1) = 200 units; Item E: (50 * 1 * 1) = 50 units; Item F: (50 * 1 * 1 * 4) +
(50 * 2 * 1) =
300 units. (MRP structure, moderate) {AACSB: Analytic Skills}
145. Consider the following bill of material. Forty units of Product A are needed. Assuming no
on-hand inventory, and no scheduled receipts, explode the bill of material.
A
B(2)
E
C(3)
F
D
G
E(2)
G
Item A: 40 units; Item B: 40 * 2 = 80 units; Item C: (40 * 3) = 120 units; Item D: (40 *
1) = 40 units; Item E: (80 * 1) + (40 * 2) = 160 units; Item F: (120 * 1) = 120 units;
Item G: 120 + 40
160 units. (MRP structure, moderate) {AACSB: Analytic Skills}
399
146. Clancy's Motors has the following demand to meet for custom manufactured fuel injector
parts.
The holding cost for that item is $.75 per month and each setup costs $150. Calculate
the order quantity by use of the part-period algorithm. Lead time is 2 months.
Month
Requirement
EPP =
1
100
2
150
Setup cost
Holding cost
3
200
$ 150
=
4
150
5
100
6
150
7
250
= 200 units
$ 0 .75
In Period 1, an order for 250 units should be received; in Period 3, an order for 350
units should be received; in Period 5, an order for 250 units should be received, and
in Period 7, an order for 250 should be received, as per the table below.
Period
Order size # of Units # period
PP
CumPP
1
100
0
1, 2
250
150
1
150
150*
1, 2, 3
450
200
2
400
550
3
200
0
3, 4
350
150
1
150
150*
3, 4, 5
450
100
2
200
350
5
100
0
5,6
250
150
1
150
150*
5,6,7
500
250
2
500
650
7
250
(Lot-sizing techniques, moderate) {AACSB: Analytic Skills}
147. The MPS calls for 120 units of Product M. There are currently 30 of Product M on hand.
Each M
requires 4 of Component N. There are 20 units of N on
hand. a. Calculate the net requirements for M.
b. Calculate the gross requirements
for N. c. Calculate the net
requirements for N.
(a) 120 - 30 = 90; (b) 90 x 4 = 360; 360 - 20 = 340
(MRP structure, easy) {AACSB: Analytic Skills}
148. The MPS calls for 110 units of Product A. There are currently 60 of Product A on hand.
Each A
requires 2 of Part B. There are 30 units of B
available. a. Calculate the net requirements for A.
b. Calculate the gross requirements for B.
c. Calculate the net requirements for B.
(a) 110 - 60 = 50; (b) 50 x 2 = 100; (c) 100 - 30
= 70 (MRP structure, easy) {AACSB:
Analytic Skills}
400
149. The MPS calls for 50 units of Product A and 60 of B. There are currently 35 of Product B
on hand.
Each A requires 2 of Part C; each B requires 5 of C. There are 160 units of C
available. a. Calculate the net requirements for B.
b. Calculate the gross requirements
for C. c. Calculate the net
requirements for C.
(a) 60 - 35 = 25; (b) 50 x 2 + 25 x 5 = 225; (c) 225 - 160 = 65
(MRP structure, easy) {AACSB: Analytic Skills}
150. Consider the bill of material for Product J and the data given in the following table.
The gross requirements for J are 200 units in week 6 and 250 units in week 8. Develop
the MRP tables for each item for an 8-week planning period. Use the lot-for-lot lotsizing rule.
Item
J
K
L
M
Lead Time
1
2
2
1
Quantity on Hand
0
20
0
20
Scheduled receipts
SEE NEXT PAGE FOR SOLUTION.
30 in week 2
10 in week 1
401
Item name
J
K
L
M
Level
0
1
2
1
Number Indented
per
BOM
parent
1
1
4
2
J
K
L
M
J
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
0
0
200
0
250
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
200
200
0
0
0
0
250
250
0
0
0
0
200
0
250
0
Lead
K
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
Minimum
quantity
0
time
2
Stock
0
Lot size
1
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
0
200
0
250
0
30
20
20
20
50
50
50
0
0
0
0
0
0
0
150
0
250
0
0
0
0
0
150
0
250
0
0
Safety
0
150
0
250
0
0
0
Lead
M
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
Safety
Minimum
quantity
0
time
1
Stock
0
Lot size
1
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
0
0
400
0
500
0
10
20
20
30
30
30
30
0
0
0
0
0
0
0
370
0
500
0
0
0
0
0
370
0
500
0
0
0
Lead
L
Gross requirements
Scheduled receipts
On Hand Inventory
NET POQ Req
Planned receipts
Planned orders
0
370
0
500
0
0
Minimum
quantity
0
time
2
Stock
0
Lot size
1
Period 0 Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8
0
0
600
0
1000
0
0
0
0
0
0
600
Safety
0
0
0
0
0
600
600
1000
0
0
0
0
(MRP structure, moderate) {AACSB: Analytic Skills}
402
0
1000
1000
0
0
0
0
0
0
0
0
0
0
0
0
0
151. Each R requires 3 of component S and 3 of material A; each S requires 3 of part T. The
lead time for assembly of R is 1 week. The lead time for the manufacture of S is 2 weeks.
The lead time for material A is 1 week. The lead time for the procurement of T is 4
weeks.
a. Construct the time-phased product
structure. b. Construct the bill of material.
Solution:
(MRP structure, moderate) {AACSB: Analytic Skills}
152.
Each X requires 2 of component Y and 1 of part W. Each Y requires 10 of Z. Each W
requires 3 of Q and 2 of R. Lead times are X = 1 week, Y = 1 week, W = 2 weeks, R = 1
week, Z = 3 weeks, and Q = 3 weeks.
a. Construct the time-phased product
structure. b. Construct the bill of material.
Solution:
(MRP structure, moderate) {AACSB: Analytic Skills}
403
153. A product has the following gross requirements. Which is cheaperlot-for-lot, part period
balance, or EOQ lot sizing?
Week
Requirements
1
50
2
80
3
90
4
50
5
30
6
60
Other data for this scenario include: setup cost = $250, inventory holding cost $2 per unit
per week. There is no beginning inventory; there are no scheduled receipts. The usage
pattern is expected to continue for the remainder of the year.
Lot-for-lot will cost $250 x 6 = $1,500 for the six periods.
2 60 52 250
EOQ is based on 60 units per week
= 122
2 52
demand:
60 52
Annual setup costs 122 250 = $6,393;
=
122 2 52 = $ 6 , 344
Annual holding costs
=
2
6 = $1,469
52
Total annual costs = $12,737; Cost for six weeks = 12,737
For part-period balancing, the EPP=250/2 = 125. Total cost for PPB over the six
periods is
$1,210.
Period
1
1, 2
1, 2, 3
3
3, 4
3, 4, 5
3, 4, 5, 6
6
Order size # of Units
70
0
150
80
240
90 * 2
90
0
160
70
200
40 * 2
270
70 * 3
70
0
CumPP
0
80*
260
0
70
150*
360
0
Total
Setup cost Holding
250
1
250
3
250
750
0
460
Summary of costs: LFL = $1,500; EOQ = $1,469; PPB = $1,210. PPB is cheapest
lot-sizing model for this problem. (Lot-sizing techniques, moderate) {AACSB:
Analytic Skills}
404
154. A product has the following gross requirements. Which is cheaperlot-for-lot or EOQ lotsizing?
Week
Requirements
1
50
2
30
3
40
4
80
Other data for this scenario include: setup cost = $1000, inventory holding cost $1 per
unit per week. There is no beginning inventory; there are no scheduled receipts. The
usage pattern is expected to continue for the remainder of the year.
Lot-for-lot will cost $1000 x 4 = $4,000 for the 5our periods.
2 f 0 52 1000
EOQ is based on 50 units per week
= 316
1 52
demand:
Annual setup costs
=
50 52
316 1000 = $8,228;
Annual holding costs
=
316 1 52 = $ 8 , 216
2
4 = $1,265
52
Total annual costs = $16,444; Cost for four weeks = 16,444
Summary of costs: LFL = $4,000; EOQ = $1,265. EOQ is cheaper lot-sizing model
for this problem. (Lot-sizing techniques, moderate) {AACSB: Analytic Skills}
155.
Construct a product structure tree for a movie purchased in DVD format. Assume that it
contains a single DVD disk. Don't be concerned with artworkyou may use labeled
boxes for your parts and assemblies.
Not all DVDs are alike in their construction, so student answers will vary. Here is a
fairly generic version. Note that the primary container is a one-piece molded
plastic "clamshell." There are three layers, 0, 1, and 2.
Movie, DVD
format
One-piece
molded
clamshell
Clear
view
layer
Packaging
assembly
Contents
assembly
Case Assembly
Electronic
security
tag
DVD
disk
Chapter
list
Outside
label
Shrink
wrap
Security
tape (3)
(Dependent inventory model requirements, moderate) {AACSB: Analytic Skills}
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156. Construct an indented bill of material for a common 3-ring view binder (the kind that
lets you slip your own cover sheet into the front panel). Assume the rings to be 1 inch
diameter. Don't worry about other dimensionspay attention to accounting for all of the
parts.
Not all such binders are identical, and student answers will vary, but here is a fairly
generic version. The main components are the cover assembly and the ring
assembly. Students will need to include some form of locking mechanism and/or
spring.
Indented bill of material, Three-ring binder
Cover assembly
Front cover
Chipboard interior
Vinyl exterior, inside and outside of front cover
Clear "view" layer, outside
Vinyl pocket, inside
Spine
Chipboard interior
Vinyl exterior, inside and outside of front cover
Clear "view" layer, outside
Back cover
Chipboard interior
Vinyl exterior, inside and outside of front cover
Clear "view" layer, outside
Vinyl pocket, inside
Ring Assembly
Spine
Main spine (holds the three sets of rings and the
tabs) Spring (runs the length of the spine)
Rings (3)
Left ring half
Right ring half
Spacer and tensioner (2)
Clasps (2) (holds the locking tabs
in) Rivets (2)
Locking tabs
(2) Paperwork
Front insert
Spine insert
UPC tag
(Dependent inventory model requirements, moderate) {AACSB: Analytic Skills}
157. Jacquie Welkener, operations manager for ABC Technologies, must schedule work for
the next five days. Each unit takes 30 minutes to process. Available capacity is 8
hours per day. The production order quantities are 12, 18, 20, 13, and 17 for Monday
through Friday, respectively. What should be the production plan?
Sixteen units should be produced each day. Thus, 4 units should be moved from
Tuesday to Monday, 2 units should be moved from Wednesday to Tuesday, 2 units
should be moved from Wednesday to Thursday, and 1 unit should be moved from
Friday to Thursday. (Extensions of MRP, easy) {AACSB: Analytic Skills}
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