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ERP Multiple Choice Questions :-
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1. Demand for a given item is said to be dependent if
A. the item has several children
B. there is a deep bill of materials
C. the finished products are mostly services (rather than goods)
D. there is a clearly identifiable parent
Answer: D
2. Dependent demand and independent demand items differ in that
A. for any product, all components are dependent-demand items
B. the need for independent-demand items is forecasted
C. the need for dependent-demand items is calculated
D. all of the above are true
Answer: D
3. A master production schedule specifies
A. the financial resources required for production
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
Answer: C
4. 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
Answer: A
5. A master production schedule contains information about
A. quantities and required delivery dates of all sub-assemblies
B. quantities and required delivery dates of final products
C. inventory on hand for each sub-assembly
D. inventory on hand for each final product
Answer: B
6. 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
Answer: A
7. In job shop (make-to-order) operations, the master production schedule is usually expressed in
terms of
A. end-items
B. modules
C. kits
D. customer orders
Answer: D
8. The following table is an example of a(n)
Week 1 Week 2 Week 3 Week 4 Week 5
Clothes Washer 200 100
Clothes Dryer 300 100 100 100
Upright Freezer 200 500
A. aggregate plan
B. load report
C. master production schedule
D. inventory record
Answer: C
9. The ______ is the input to Materials Requirements Planning which lists the assemblies,
subassemblies, parts and raw materials needed to produce one unit of finished product.
A. bill of materials
B. net requirements chart
C. inventory records
D. assembly time chart
Answer: A
10. A bill of materials 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
Answer: C
11. One way to facilitate production scheduling and production in firms making a large number of
different final products is to use
A. planning bills
B. modular bills
C. phantom bills
D. overdue bills
Answer: B
12. The bill of materials contains information necessary to
A. convert (explode) net requirements at one level into gross requirements at the next level
B. calculate quantities on hand and on order
C. convert gross requirements into net requirements
D. place an order to replenish the item
Answer: A
13. 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 represent subassemblies that actually exist and are inventoried, while phantom
bills represent subassemblies that exist only temporarily and are not inventorieD.
Answer: D
14. Given the following bill-of-materials:
If the demand for product A is 50 units, what will be the gross requirement for component E?
A. 300
B. 100
C. 200
D. 250
Answer: A
15. The minimum record accuracy required for successful MRP is approximately
A. lower than 90%
B. 90%
C. 95%
D. 99%
Answer: D
16. Given the following bill of materials
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
Answer: A
17. Given the following bill of materials
If the demand for product A is 30 units, and there are on hand 10 units of B and none of C, how many units of part D will be needed?
A. 3
B. 40
C. 70
D. 90
Answer: C
18. “Exploding” the bill of materials means
A. converting the bill of materials into components and raw material requirements
B. identifying the lead time of all the components
C. determining the various components’ quantities that are already on hand
D. determining the net requirements for all the components
Answer: A
19. 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 missing items
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 BOM’s are not organized around the finished product
Answer: C
20. 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. 48
B. 7
C. 8
D. 10
Answer: C
21. 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
Answer: B
22. 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 gross requirements for N are
A. 150
B. 170
C. 300
D. 320
Answer: C
23. 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
Answer: A
24. 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
Answer: C
25. 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
Answer: D
26. A material requirements plan contains information with regard to all of the following except
A. quantities and required delivery dates of all sub-assemblies
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
Answer: C
27. 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
Answer: D
28. 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
Answer: C
29. 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 materials
Answer: A
30. 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
Answer: C
31. A major strength of MRP is its capability
A. to minimize labor hours used in production
B. for timely and accurate replanning
C. to reduce lead times
D. to maximize production throughput
Answer: B
32. Material requirements plan 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 6
Answer: B
33. 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 net requirements
for its parent(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.
Answer: B
34. Which of the following lot-sizing-techniques results in the lowest holding costs?
A. lot-for-lot
B. EOQ
C. part-period-balancing
D. Wagner-Whitin algorithm
Answer: A
35. What lot sizing technique is generally preferred when inventory holding costs are extremely high?
A. lot-for-lot
B. EOQ
C. part-period balancing
D. the Wagner-Whitin algorithm
Answer: A
36. For the lot-for-lot lot-sizing technique 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
Answer: B
37. MRP II is accurately described as
A. MRP software designed for services
B. MRP with a new set of computer programs that execute on micro-computers
C. MRP augmented by other resource variables
D. usually employed to isolate manufacturing operations from other aspects of an organization
Answer: C
38. Enterprise Resource Planning (ERP) is
A. severely limited by current MRP computer systems
B. not related to MRP
C. an advanced MRP II system that ties-in customers and suppliers
D. not currently practical
Answer:
39. 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 7
Answer: B
40. 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
Answer: B