EXAM 2 REVIEW

Ch. 5-8

The principle input to SOP process is sales forecast update.

True

A stable operations plan results in far fewer execution problems.

True

Volume decisions concern overall production rates and aggregate inventories.

True

SOP is primarily a detailed scheduling tool used by shop-floor supervisors.

False

Which of the following statements is correct?

 

All of the statements are correct

Why is SOP performance monitoring essential?

 

To ensure plans remain achievable

What is the primary objective of Sales and Operations Planning (SOP)?

 

To integrate functional plans into one business plan

Which statement best reflects the role of SOP?

 

SOP balances demand and supply at the volume level

Product families in aggregate planning are usually defined by marketing segments.

False

One limitation of linear programming is its inability to model economies of scale.

True

In Mixed Integer Programming, it is possible to limit some decision variables to have only integer values.

True

Sales and Operations Planning problems may be solved optimally using mathematical modeling techniques.

True

Aggregate production planning models are most closely aligned with which planning horizon?

 

Tactical intermediate planning

SOP problems may be expressed as mathematical models with a set of constraints. A common constraint may be

a. the desired end-of-period inventory levels

A primary purpose of aggregate production planning models is to:

 

Provide direction to execution systems

SOP problems may be expressed as mathematical models with a set of constraints. A typical constraint may be

a. cost of hiring and firing

Rolling the MPS forward requires incorporating actual sales and updated forecasts.

True

Sales and Operations Planning (SOP) provides a direct input to Master Production Scheduling (MPS).

True

On a day-to-day basis, the MPS provides the information by which sales and manufacturing are coordinated.

True

Manufacturing is held responsible for meeting the requirements specified in the MPS.

True

Which information must the MPS always specify?

 

Products, quantities, and timing

A planning bill of materials is most likely used in which MPC environment?

b. Assemble-to-Order

The disaggregation of the SOP into production plans for specific products defines the

a. product mix that will be produced

MPS has linkages to which of the following in the MPC framework?

 

I. Strategic planning

II. Sales and Operations Planning

III. Rough-cut Capacity Planning

IV. Demand Management

V. Material Requirements Planning

 

d. II, III, IV, and V only

Following a chase strategy, how many workers would be needed in the month of March given that forecasted demand in March is 6,600 units, there are 22 working days, and worker productivity is 5 units per day? 

60

In a chase strategy, if the forecasted demand in November is 1,800 units, and there are 24 working days in November, how much inventory should be held at the end of October if the goal is 8 days’ supply?

600

Given that a chase strategy is used,
regular production capacity is 4,000 units with a per unit cost of $18, 
overtime capacity may be used with a per unit cost of $ 27, 
forecasted demand for the month of January is 5,300 units,
the beginning inventory is 450 units, desired end of month inventory is 600 units.

What is the total cost of production in this month to match the sales plan?

111,150

Given that beginning inventory level is 2,000 units, total forecasted demand over the next 12 months is 30,100 units, and desired ending inventory level at the end of the 12th month is 2,200 units, what should be the planned production per month if a level strategy is used? (round to the nearest integer)

2,525

Given that beginning inventory level is 3,200 units, total forecasted demand over the net 12 months is 86,900 units, and desired ending inventory level at the end of the 12th month is 4,800 units, what is the cost of production per month if a level strategy is used and per unit cost of production is $24? (round to the nearest integer)

177,000

Given the following information, what is the projected available inventory balance at the end of period 4?

30

Given the following information, what is the projected available inventory balance at the end of period 3?

37

Use discrete available-to-promise (ATP) logic, and the master production schedule (MPS) for the following information. How many units are available-to-promise in period 3?

83

Given the following information, prepare the MPS using a Fixed Order Quantity (FOQ) of 60 and calculate the projected available inventory balances. What is the projected available inventory balance at the end of period 3?

3

Given the following information, prepare the MPS using a Fixed Order Quantity (FOQ) of 90 and calculate the projected available inventory balances. What is the projected available inventory balance at the end of period 3?

103

Small transaction errors in MRP records can cascade and cause major production disruptions.

True

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

False

Allocation ensures that material assigned to a shop order is no longer available for other orders.

True

Firm planned orders require managerial approval to be changed by the MRP system.

True

Planned order releases in MRP are open confirmed orders.

False

Capacity requirements planning is an important feature in MRP.

False

The planning horizon should be at least as long as the longest cumulative lead time of level-0 items.

True

Safety Lead Time tends to be used in MRP systems where there is considerable quality issues associated with the production process 

False

Gross-to-net explosion accounts for on-hand inventory and scheduled receipts when determining requirements.

True

Low-level coding ensures that a part is processed only after all its gross requirements are known.

True

MRP planners are responsible for releasing orders, rescheduling due dates, and updating planning parameters.

True

In MRP, an item must be available at the end of the period in which it is required.

False

MRP’s managerial objective is to provide “the right part at the right time in the right quantity” to meet the schedules for finished products.

True

A  main output of MRP is

c. a schedule of planned order releases for all parts and end items

When a planned order is created for the most immediate or current period, it is 

 

 c. in the action bucket 

Which of the following is an input to MRP?

a. Inventory status 

In which environment is a planning bill-of-material (BOM) most likely to be used?

b. Assemble-to-order

When lot-for-lot is used for lot-sizing in MRP, order quantities for component parts are essentially determined directly from which one of the following?

b.  net requirements of that part

The main objective of MRP systems is to

b. Providing the right part at the right time to meet the master production schedule.

If the lot-for-lot (L4L) technique is used in MRP, we would expect 

b. minimized inventory carrying costs

Which of the below is (are) an advantage of back scheduling in MRP? 

 

d. all of the options are advantages

In the MPC framework described, MRP is primarily part of the:

 

Engine (detailed material planning)

In MRP,  Gross-to-Net explosion

Ensures that only requirements net of inventory and scheduled receipts are passed on to lower level items

Scheduled receipts differ from planned order releases in that scheduled receipts

 

d. are orders that have already been released

Back scheduling primarily aims to start each item:

 

As late as possible while still meeting requirements

In MRP the decision regarding the quantity of an order release is referred to as

c. lot sizing

Determine the value of X in the below table.

55

Determine the value of X in the below table.

1,500

Determine the value of X in the below table.

610

Given the following information, determine the value of X in the table for item C

28

Given the following information, determine the value of X in the table for item C below

0

Given the following information, determine the value of X in the table for item E below. (Hint: you will need to complete the table for item D in order to find the answer).

284

Given the following information, determine the value of X in the table for item D below. (Hint: you will need to complete the table for item D in order to find the answer).

30

Determine the value of X in the table for item D below. (Hint: you will need to complete the table for item D in order to find the answer).

140