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DSP Test Yourself

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Detailed Scheduling and Planning

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  1. Question 1 of 30
    1. Question

    In MRP processing, a planned order will be generated when:

    Correct

    Planned orders are generated in periods where the total requirement is greater than the total availability.
    Total requirement = Gross requirement + safety stock; total availability = projected available balance from the previous period + scheduled receipts in this period.
    The answer is 4

    Incorrect

    Planned orders are generated in periods where the total requirement is greater than the total availability.
    Total requirement = Gross requirement + safety stock; total availability = projected available balance from the previous period + scheduled receipts in this period.
    The answer is 4

  2. Question 2 of 30
    2. Question

    If a company buys material in quantities that are equal to the demand over the next 4 periods, the lot sizing technique being used is:

    Correct

    This is an example of period order quantity. The answer is 4

    Incorrect

    This is an example of period order quantity. The answer is 4

  3. Question 3 of 30
    3. Question

    High levels of inventory record accuracy will usually result in all of the following except:

    Correct

    High levels of accuracy will result in fewer surprise shortages, and the level of safety stock will be cut, thus reducing the overall levels of inventory, the risk of obsolescence. While cycle counting may be easier as the problems have been resolved, we cannot afford to reduce the vigilance that achieved this high level of accuracy, so the LEVEL of cycle counting will not be reduced. The answer is 1

    Incorrect

    High levels of accuracy will result in fewer surprise shortages, and the level of safety stock will be cut, thus reducing the overall levels of inventory, the risk of obsolescence. While cycle counting may be easier as the problems have been resolved, we cannot afford to reduce the vigilance that achieved this high level of accuracy, so the LEVEL of cycle counting will not be reduced. The answer is 1

  4. Question 4 of 30
    4. Question

    Data accuracy is best achieved through which of the following processes?

    Correct

    In the same way as a cycle count is an audit of the inventory records to dive inventory accuracy, auditing BOMs is the best way to achieve BOM accuracy. 1 and 2 are practices that should be in place, and the audit verifies their completeness and accuracy.  4 will help to maintain inventory accuracy, but the best answer is 3

    Incorrect

    In the same way as a cycle count is an audit of the inventory records to dive inventory accuracy, auditing BOMs is the best way to achieve BOM accuracy. 1 and 2 are practices that should be in place, and the audit verifies their completeness and accuracy.  4 will help to maintain inventory accuracy, but the best answer is 3

  5. Question 5 of 30
    5. Question

    When using safety lead-time, which of the following statements is true?

    Correct

    Safety lead time offsets the planned order receipt date from the net requirement date by the duration of the safety lead time. The answer is 3

    Incorrect

    Safety lead time offsets the planned order receipt date from the net requirement date by the duration of the safety lead time. The answer is 3

  6. Question 6 of 30
    6. Question

    The provision of planned order data to suppliers allows these suppliers to improve all of their manufacturing planning and control systems except for which of the following?

    Correct

    The provision of this data enables the supplier to plan his business better, therefore it will facilitate options 1, 3 and 4. It will not enable him to better control his production activity, which is done through PAC. The answer therefore is 2

    Incorrect

    The provision of this data enables the supplier to plan his business better, therefore it will facilitate options 1, 3 and 4. It will not enable him to better control his production activity, which is done through PAC. The answer therefore is 2

  7. Question 7 of 30
    7. Question

    In a process-based layout, lead time reduction is best accomplished by which of the following?

    Correct

    In a process based, or job shop type industry, the most effective way to reduce lead times is through reducing queues. The answer is 3

    Incorrect

    In a process based, or job shop type industry, the most effective way to reduce lead times is through reducing queues. The answer is 3

  8. Question 8 of 30
    8. Question

    Which of the following are the primary responsibility or purchasing?

    I. Defining the required quality levels

    II. Negotiating product prices.

    III. Defining service requirements.

    IV. Monitoring supplier performance

    Correct

    I is the responsibility of quality and engineering; III is the responsibility of the materials planner. II and IV are the responsibility of purchasing. The answer is 2

    Incorrect

    I is the responsibility of quality and engineering; III is the responsibility of the materials planner. II and IV are the responsibility of purchasing. The answer is 2

  9. Question 9 of 30
    9. Question

    A delivery of components has been unavoidably delayed. In a process-based industry, which of the following techniques should the planner use to identify the effect of this delay?

    Correct

    Full pegging will identify the products that create the demand for this item and that will be affected by this surprise shortage. We will still need to look at the MRP records to identify the material affect of the short in relation to each of those parts, and the routing to identify if enough interoperation time exists to enable a late start of the order for the part without delaying completion (by expediting to reduce queue time etc). The best answer therefore is 4

    Incorrect

    Full pegging will identify the products that create the demand for this item and that will be affected by this surprise shortage. We will still need to look at the MRP records to identify the material affect of the short in relation to each of those parts, and the routing to identify if enough interoperation time exists to enable a late start of the order for the part without delaying completion (by expediting to reduce queue time etc). The best answer therefore is 4

  10. Question 10 of 30
    10. Question

    The inputs to MRP include which of the following?

    I. Finished goods forecasts

    II. Bills of material

    III. Purchase order data

    IV. Material constraint data

    Correct

    The inputs to MRP are the MPS, Inventory data (which includes open purchase and works orders) and bills of material. The only options opposite that fall into those categories are II and III. The forecasts will be used as an input to the MPS, and material constraints will be an input to RCCP. The answer is 2

    Incorrect

    The inputs to MRP are the MPS, Inventory data (which includes open purchase and works orders) and bills of material. The only options opposite that fall into those categories are II and III. The forecasts will be used as an input to the MPS, and material constraints will be an input to RCCP. The answer is 2

  11. Question 11 of 30
    11. Question

    When should stock status be updated?

    Correct

    Stock status should be updated when the parts have been made available for use. Only 3 of the above four options satisfies that criteria

    Incorrect

    Stock status should be updated when the parts have been made available for use. Only 3 of the above four options satisfies that criteria

  12. Question 12 of 30
    12. Question

    Actual manufacturing lead time is a function of which of the following?

    I. Priority

    II. Capacity available

    Correct

    Actual manufacturing lead time will be affected by the urgency of the order – the priority – and the availability or otherwise of capacity to maintain queues at the planned level. The answer therefore is 3

    Incorrect

    Actual manufacturing lead time will be affected by the urgency of the order – the priority – and the availability or otherwise of capacity to maintain queues at the planned level. The answer therefore is 3

  13. Question 13 of 30
    13. Question

    Immediate inputs to capacity requirements planning are which of the following?

    I. Production plan

    II. Planned orders

    III. Scheduled receipts

    Correct

    The inputs to capacity requirements planning are the capacity available, the open orders (scheduled receipts) and planned orders. The production plan is an input to Resource Planning. The correct answer therefore is 4

    Incorrect

    The inputs to capacity requirements planning are the capacity available, the open orders (scheduled receipts) and planned orders. The production plan is an input to Resource Planning. The correct answer therefore is 4

  14. Question 14 of 30
    14. Question

    Common units of capacity include which of the following?

    I.Dollars

    II.Standard labour hours

    III.Standard machine hours

    IV.Pieces

    Correct

    All of the above except money may be used as a measure of capacity. The answer therefore is 3

    Incorrect

    All of the above except money may be used as a measure of capacity. The answer therefore is 3

  15. Question 15 of 30
    15. Question

    The outputs of an MRP system include which of the following?

    I. Order release notices

    II. Reschedule notices

    III. Cancellation notices

    IV. Planned order releases

    Correct

    All of the above are included in the outputs of an MRP system. The answer is 4

    Incorrect

    All of the above are included in the outputs of an MRP system. The answer is 4

  16. Question 16 of 30
    16. Question

    Which of the following MRP functions is relevant to the completeness of capacity planning data?

    Correct

    The only one of these four options that directly affects capacity planning is the generation of planned orders. Each of the other three is how it does that. The answer is 3

    Incorrect

    The only one of these four options that directly affects capacity planning is the generation of planned orders. Each of the other three is how it does that. The answer is 3

  17. Question 17 of 30
    17. Question

    In the usual scheme of things, priority planning is a function of:

    Correct

    MRP is said to be a priority planning system – it plans the availability of material at the date of need. CRP assists in this by planning the availability of capacity – but will sometimes plan material availability prior to date of need to enable a balanced workload to be created. Input/output control is a capacity control technique, and dispatching is a priority control technique. The answer is 1

    Incorrect

    MRP is said to be a priority planning system – it plans the availability of material at the date of need. CRP assists in this by planning the availability of capacity – but will sometimes plan material availability prior to date of need to enable a balanced workload to be created. Input/output control is a capacity control technique, and dispatching is a priority control technique. The answer is 1

  18. Question 18 of 30
    18. Question

    In which of the following situations would the creation of a blanket order be deemed most appropriate?

    Correct

    Blanket orders are used to reduce lot size by reducing ordering cost. Therefore 1 is true statement – the cost is not the paper, but the time involved in managing all of the information and the actions involved with the paper.

    Options 2, 3 and 4 all refer to specific quantities, and so are not as good an answer as 1.

    The best answer is 1

    Incorrect

    Blanket orders are used to reduce lot size by reducing ordering cost. Therefore 1 is true statement – the cost is not the paper, but the time involved in managing all of the information and the actions involved with the paper.

    Options 2, 3 and 4 all refer to specific quantities, and so are not as good an answer as 1.

    The best answer is 1

  19. Question 19 of 30
    19. Question

    Which of the following will result in a reduction of actual carrying costs of inventory?

    Correct

    The only way to reduce the actual carrying cost is to reduce the level of inventory. Average inventory = lot size/2 + safety stock, and of the above four options the only one that directly addresses this is option 2.

    Eliminating incoming inspection reduces the ordering cost, which in turn CAN lead to a reduction in lot size. Establishing storage points merely redistributes inventory, not reduces it, and reducing the carrying cost factor will enable BIGGER lot sizes which will increase inventory

    Incorrect

    The only way to reduce the actual carrying cost is to reduce the level of inventory. Average inventory = lot size/2 + safety stock, and of the above four options the only one that directly addresses this is option 2.

    Eliminating incoming inspection reduces the ordering cost, which in turn CAN lead to a reduction in lot size. Establishing storage points merely redistributes inventory, not reduces it, and reducing the carrying cost factor will enable BIGGER lot sizes which will increase inventory

  20. Question 20 of 30
    20. Question

    Using ABC analysis to determine cycle counting frequency is an example of which of the following:

    Correct

    ABC analysis utilizes Pareto’s Law; applied to inventory it states that 80% of the money spent will be spent on 20% of the parts. ABC analysis classifies parts according to their level of importance based on annual spend on each part. Typically every A class part is counted once per month; every B class part once per quarter and every C class part at most twice per year.  Inventory planning is carried out by MRP; stockroom management will include cycle counting – but the classifications are set on more than the value of goods in stock. Trend analysis is used to develop forecasts. The best answer is 2

    Incorrect

    ABC analysis utilizes Pareto’s Law; applied to inventory it states that 80% of the money spent will be spent on 20% of the parts. ABC analysis classifies parts according to their level of importance based on annual spend on each part. Typically every A class part is counted once per month; every B class part once per quarter and every C class part at most twice per year.  Inventory planning is carried out by MRP; stockroom management will include cycle counting – but the classifications are set on more than the value of goods in stock. Trend analysis is used to develop forecasts. The best answer is 2

  21. Question 21 of 30
    21. Question

    Which of the following statements is untrue in relation to inventory?

    Correct

    Inventory is included in the balance sheet as an asset – that is an asset in the financial sense. Therefore 1 is true and 2 is false. Operationally, inventory can be either an asset or a liability: an asset insofar as by operating as a buffer between the different stages in the supply chain it will enable each stage to progress at the pace most suited to it; a liability insofar as we are obliged to make use of the inventory that we have, which may or may not be most suited to the needs of the moment.  Therefore both 3 and 4 are true. The best answer is 2

    Incorrect

    Inventory is included in the balance sheet as an asset – that is an asset in the financial sense. Therefore 1 is true and 2 is false. Operationally, inventory can be either an asset or a liability: an asset insofar as by operating as a buffer between the different stages in the supply chain it will enable each stage to progress at the pace most suited to it; a liability insofar as we are obliged to make use of the inventory that we have, which may or may not be most suited to the needs of the moment.  Therefore both 3 and 4 are true. The best answer is 2

  22. Question 22 of 30
    22. Question

    In MRP processing, a planned order receipt will be generated when:

    Correct

    Planned order receipts are generated by MRP in period where there is a net requirement. A net requirement is generated when DEMAND (the sum of the gross requirements and the safety stock) exceeds AVAILABILITY (the sum of the projected available balance in the previous period and any scheduled receipts in the period being planned). This means that 1, 2 and 3 are all false, and while 4 is not a COMPLETE answer (based on the above statement on when a net requirement exists) it is the BEST answer of the four options given. The answer is 4

    Incorrect

    Planned order receipts are generated by MRP in period where there is a net requirement. A net requirement is generated when DEMAND (the sum of the gross requirements and the safety stock) exceeds AVAILABILITY (the sum of the projected available balance in the previous period and any scheduled receipts in the period being planned). This means that 1, 2 and 3 are all false, and while 4 is not a COMPLETE answer (based on the above statement on when a net requirement exists) it is the BEST answer of the four options given. The answer is 4

  23. Question 23 of 30
    23. Question

    If a company buys material in fixed quantities that are greater than the average usage, the remaining inventory is called

    Correct

    Excess stock exist when we have more of an item on hand or on order than there is demand for; Obsolete stock is inventory for which no demand exists and for which no demand is foreseen; slow-moving stock is similar to excess stock. Lot size stock is the excess stock arising from purchasing in quantities greater than the current demand. The answer is 4

    Incorrect

    Excess stock exist when we have more of an item on hand or on order than there is demand for; Obsolete stock is inventory for which no demand exists and for which no demand is foreseen; slow-moving stock is similar to excess stock. Lot size stock is the excess stock arising from purchasing in quantities greater than the current demand. The answer is 4

  24. Question 24 of 30
    24. Question

    High levels of inventory record accuracy will usually result in

    Correct

    The greater the degree of inventory accuracy, the less need there is for safety stock to guard against surprise shortages. As the average inventory is Lot Size / 2 + Safety Stock, this will result in a reduction in inventory levels, and a reduction in inventory carrying costs. Therefore 1 is false and 2 is true. Cycle counting helps maintain high levels of accuracy buy identifying the causes of inaccuracy, so 3 is false. 4 is false as shortages can occur from unexpected demand, and accuracy cannot prevent that. The answer is 2

    Incorrect

    The greater the degree of inventory accuracy, the less need there is for safety stock to guard against surprise shortages. As the average inventory is Lot Size / 2 + Safety Stock, this will result in a reduction in inventory levels, and a reduction in inventory carrying costs. Therefore 1 is false and 2 is true. Cycle counting helps maintain high levels of accuracy buy identifying the causes of inaccuracy, so 3 is false. 4 is false as shortages can occur from unexpected demand, and accuracy cannot prevent that. The answer is 2

  25. Question 25 of 30
    25. Question

    The following two terms can be used in reference to the timing of a purchase order or completion of a shop order

    I. Due date

    II. Date of need

    Which of the following statements is true?

    Correct

    Before an order is released it is either planned order or a firm planned order. In the case of planned orders, the two dates will NOT differ, but they may do for FPOs.

    Statement 1 is false, because either date may change after the order is released.

    Statement 2 is true, as we must ensure that goods are available at the time they are needed.

    Statement 3 is true, but is not a good answer as there an inference of relying on “chance” to manage our business – not a good idea.

    Statement 4 is false, because either date may change after the order is released

    Incorrect

    Before an order is released it is either planned order or a firm planned order. In the case of planned orders, the two dates will NOT differ, but they may do for FPOs.

    Statement 1 is false, because either date may change after the order is released.

    Statement 2 is true, as we must ensure that goods are available at the time they are needed.

    Statement 3 is true, but is not a good answer as there an inference of relying on “chance” to manage our business – not a good idea.

    Statement 4 is false, because either date may change after the order is released

  26. Question 26 of 30
    26. Question

    In a product based layout, lead time reduction is best accomplished by which of the following?

    Correct

    A product based layout is best represented by a production line. To speed up a production line, it is best to equalize the time needed at each work station, and to reduce the time between completion of a product and the commencement of work on the next product. This is best achieved by 4 opposite – set-up times are practically irrelevant; there are no queues, and equalizing task times may mean that some task times may need to be increased

    Incorrect

    A product based layout is best represented by a production line. To speed up a production line, it is best to equalize the time needed at each work station, and to reduce the time between completion of a product and the commencement of work on the next product. This is best achieved by 4 opposite – set-up times are practically irrelevant; there are no queues, and equalizing task times may mean that some task times may need to be increased

  27. Question 27 of 30
    27. Question

    Strategic sourcing, rather than tactical buying, is more appropriate in which of the following situations?

    Correct

    Strategic sourcing is required where there is any risk in terms of availability, technology or price. Only 4 opposite encompasses any of these

    Incorrect

    Strategic sourcing is required where there is any risk in terms of availability, technology or price. Only 4 opposite encompasses any of these

  28. Question 28 of 30
    28. Question

    Which of the above statements are/is generally true?

    I. The higher the level of the component item the more parents it tends to have

    II. The lower the level of the component item the more parents it tends to have

    III. There is no logical requirement for the low level coding technique to be employed in a net change MRP system

    Correct

    Statement I is generally false – the lower a component is down the product structure tree (the lower the level on bills of material) the more likely it is that it will be used in multiple products.

    Statement II is true, (see above)

    Statement III is true as the primary purpose of the low level code technique is to identify to the software that ALL of the possible sources of requirements for the part have been processed. However, a net change system will only replan a part if any unplanned event occurs for that part, so the low-level code is not necessarily needed in that case.

    The best answer is 3

    Incorrect

    Statement I is generally false – the lower a component is down the product structure tree (the lower the level on bills of material) the more likely it is that it will be used in multiple products.

    Statement II is true, (see above)

    Statement III is true as the primary purpose of the low level code technique is to identify to the software that ALL of the possible sources of requirements for the part have been processed. However, a net change system will only replan a part if any unplanned event occurs for that part, so the low-level code is not necessarily needed in that case.

    The best answer is 3

  29. Question 29 of 30
    29. Question

    MRP system outputs serve as valid input to which of the following systems?

    I. Shop scheduling

    II. Capacity requirements planning

    III. Shop floor control

    IV. Resource planning

    Correct

    MRP outputs include a schedule of planned purchase and production orders; and reschedule messages where appropriate for open production and purchase orders. These are used for production scheduling, prioritizing and monitoring orders on the shop floor and for detailed capacity planning. These are options I, III and II respectively. Option IV, resource planning, is carried out at the Sales and Operations Planning process.

    The correct answer is 1

    Incorrect

    MRP outputs include a schedule of planned purchase and production orders; and reschedule messages where appropriate for open production and purchase orders. These are used for production scheduling, prioritizing and monitoring orders on the shop floor and for detailed capacity planning. These are options I, III and II respectively. Option IV, resource planning, is carried out at the Sales and Operations Planning process.

    The correct answer is 1

  30. Question 30 of 30
    30. Question

    Which are true statements regarding physical inventories?

    I. They are required by outside auditors

    II. They are generally very accurate

    Correct

    Physical inventories are necessary only if an accurate, well-controlled, perpetual inventory system cannot be maintained.

    Many studies have shown that physical inventories introduce more errors than they correct.

    Incorrect

    Physical inventories are necessary only if an accurate, well-controlled, perpetual inventory system cannot be maintained.

    Many studies have shown that physical inventories introduce more errors than they correct.

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