Material Planning Test Bank

Package Title: Test bank

Course Title: Material Planning Process

Question type: Multiple Answers

1. Material planning is concerned with answering which basic questions?

1. Which planning version should the company choose?
2. What materials are required?
3. What is the shortest time required for completing the planning?
4. When are the materials required?
5. How many materials are required?

Answer: b, d, e

Difficulty: Easy

Section: Learning Objectives    

1. Which of the following statements concerning maintaining inventory at high levels are TRUE?

1. The longer the materials remain in storage, the more money the company loses.
2. Maintaining high levels of inventory can lead to serious write-offs.
3. Maintaining high levels of inventory is a recommended material planning policy.
4. Maintaining high levels of inventory can incur insurance costs.
5. The company may lose money storing excessive inventory, but the customer’s interest must be the company’s highest priority.

Answer: a, b, d

Difficulty: Medium

Section: Learning Objectives  

1. The proposals that material planning generates typically are in the form of

1. A planning proposal.
2. Planned orders.
3. A material order list.
4. Purchase requisitions.
5. Purchase list.

Answer: b, d

Difficulty: Easy

Section: Learning Objectives    

1. Which of the following statements concerning the material planning process are NOT TRUE?

1. It can involve the creation of an operations plan.
2. The demand management step creates requirements for individual materials.
3. The final procurement proposals trigger either the production or procurement process.
4. The requirements step specifies the way the materials will be transported.
5. MRP uses sales objectives to generate the final procurement proposals.

Answer: d, e

Difficulty: Medium

Section: Learning Objectives  

1. Which of the following are key organizational elements in materials planning?

1. Company code
2. Shipping point
3. Plant
4. Storage location
5. Sales area

Answer: a, c, d

Difficulty: Easy

Section: Learning Objectives  

1. Which of the following are master data relevant to material planning?

1. Storage location
2. Bills of material
3. Material master
4. Planning version
5. Production version

Answer: b, c

Difficulty: Easy

Section: Master Data  

1. Which of the following statements regarding the MRP views of the material master are TRUE?

1. There are four MRP data views.
2. The system uses the MRP 4 view to select the correct BOM.
3. There are three MRP data views.
4. The system uses the MRP 3 view to determine how to procure materials (make vs. buy).
5. The system uses the MRP 1 view to select the correct BOM.

 Answer: a, b

Difficulty: Medium

Section: Master Data        

1. Which of the following statements concerning the outcome of the material planning process are NOT TRUE?

1. The outcome can be multiple procurement proposals.
2. The outcome is always a single procurement proposal.
3. The outcome triggers the sales and operations planning step.
4. The outcome triggers the forecasting planning step.
5. The outcome can trigger either the production or the procurement process.

           Answer: b, c, d

      Difficulty: Medium

         Section: Procurement Type      

1. Which of the following represent procurement types?

1. Consumption-based planning
2. External
3. Section 2
4. None
5. No planning

Answer: b, d

Difficulty: Easy

Section: Procurement Type  

1. Which of the following are production control techniques as indicated by the MRP type in the material master?

1. Consumption-based planning
2. External control
3. Internal control
4. Sales order-based planning
5. No planning

Answer: a, e

Difficulty: Easy

Section: MRP Type  

1. Which of the following represent reasons why a company should maintain a safety stock?

1. The ERP system can be configured to automatically prevent inventory from falling below the safety stock levels.
2. To avoid stock-outs
3. Maintaining a safety stock of at least 20 pieces is mandatory in the ERP system.
4. Maintaining a safety stock will guarantee that supply meets demand.
5. To avoid lost sales

Answer: a, b, e

Difficulty: Medium

Section: MRP Type                  

1. Which of the following statements about consumption-based planning are NOT TRUE?

1. It includes forecast-based planning as one of its categories.
2. It calculates the requirements for a material based on historical consumption data.
3. It is relatively more complicated compared with MRP.
4. It assumes that future consumption will follow the same patterns as past consumption.
5. It takes into account dependencies between different materials.

Answer: c, e

Difficulty: Difficult

Section: MRP Type                  

1. Which of the following statements about MRP and MPS are TRUE?

1. MPS calculates requirements for all the levels of the BOM.
2. MRP calculates requirements only for the first-level items in the BOM.
3. Both MRP and MPS calculate requirements based on historical data only.
4. MRP calculates requirements for all levels of the BOM.
5. MPS calculates requirements only for the first-level items in the BOM.

Answer: d, e

Difficulty: Medium

        Section: MRP Type                  

1. Which of the following are common time estimates utilized during the planning process?

1. Production planning time
2. GR processing time
3. Planned delivery time
4. Planned receiving time
5. In-house production time

 Answer: b, c, e

Difficulty: Medium

        Section: Scheduling Times        

1. Which of the following are elements of the in-house production time?

1. Interoperation
2. Planned delivery
3. Processing
4. GR
5. Setup

Answer: a, c, e

Difficulty: Medium

Section: Scheduling Times        

1. The lot size independent in-house production time is used in which of the following scenarios?

1. The lot size is fixed.
2. Processing time is constant.
3. Processing time is very short compared to the setup and interoperation times.
4. Processing time is long in comparison to the setup and interoperation times.
5. The quantity of material to be produced varies.

Answer: a, b, c

Difficulty: Difficult

        Section: Scheduling Times      

1. Multiple BOMs can be created for a single material in which of the following situations?

1. The same material is produced in different plants.
2. The material is produced in the same lot sizes.
3. The material is produced in different lot sizes.
4. A bike model is upgraded with a new tire.
5. The company applies a make-to-order production planning strategy to fulfill a customer order for a material.

Answer: a, c, d

Difficulty: Medium

Section: BOM Selection Method      

1. Which of the following statements regarding a BOM are TRUE?

1. A BOM identifies the components needed to make the material.
2. A BOM identifies the sequence of operations needed to make the materials.
3. A BOM component can have its own BOM.
4. A BOM identifies the material’s routing strategy.
5. A BOM is plant specific.

Answer: a, c, e

Difficulty: Medium

        Section: General    

1. Which of the following items represent demand elements of the availability check group?

1. Purchase requisitions
2. Production orders
3. Purchase orders
4. Safety stock
5. Material reservations

         Answer: d, e

 Difficulty: Medium

 Section: Availability Check Group    

1. Identify the SAP ERP terms for net requirements planning and planning with final assembly.

1. Strategy 10
2. Strategy 20
3. Strategy 30
4. Strategy 40
5. Strategy 50

Answer: a, d

Difficulty: Easy

        Section: Strategy Group    

1. Which of the following statements about a product group are TRUE?

1. It is used to group products with similar planning characteristics.
2. Each member of a product group is assigned a group factor.
3. Materials can be members of more than one product group for different planning scenarios.
4. A material can belong to only one product group.
5. Each member of a product group is assigned a proportion factor.

           Answer: a, c, e

        Difficulty: Difficult

        Section: Product Groups