Product life cycles for many products are ________, forcing companies to not only become ________ in design but also to communicate changes and needs to suppliers and distributors. 

  1. shrinking rapidly, more flexible
  2. shrinking rapidly, less flexible
  3. growing rapidly, more flexible
  4. growing rapidly, less flexible

All portions of the material production from __________ to ___________ are considered to be a linked chain under the supply chain concept. 

  1. work in process, final customer
  2. raw material, work in process
  3. work in process, raw material
  4. raw material, final customer

To get the most profit, a company should________ 

  1. Provide little customer service
  2. Provide high production costs
  3. Provide the lowest inventory investment
  4. Provide the highest distribution costs

Finance must keep investment and costs low. This can be done by___________ 

  1. Increasing inventory so inventory investment is at a maximum
  2. Decreasing the number of plants and warehouses
  3. Producing small quantities
  4. Using short production runs

Today the concepts of ______ manufacturing stress the need to supply customers with what they want when they want it and to keep inventories at a _______. 

  1. TQM, maximum
  2. Six Sigma, maximum
  3. JIT, minimum
  4. ISO 9000, minimum

The concept of having ____ department(s) responsible for the flow of materials, from supplier through production to consumer, is relatively new.

  1. one
  2. multiple
  3. functional
  4. none of the above

Materials management is also called____________ 

  1. Distribution planning
  2. Control and logistics management
  3. Both of the above
  4. Neither of the above

Materials management is a coordinating function responsible for planning and controlling materials flow. Its objective(s) is/are: 

  1. Maximize the use of the firm's resources
  2. Provide the required level of customer service
  3. Both of the above
  4. Neither of the above

_______ and ______ are costs that increase or decrease with the quantity sold. 

  1. Direct labor, indirect material
  2. Direct labor, direct material
  3. Indirect labor, indirect material
  4. Indirect labor, direct material

Inventory not only makes up a portion of the cost of goods sold but has to be purchased at the beginning of production to be processed into finished goods. This type of inventory is called _____________. 

  1. work-in-process
  2. finished goods
  3. raw materials
  4. none of the above

A good planning system must consider:

  1. What are we going to make?
  2. What does it take to make it?
  3. What do we have and need?
  4. All of the above

_______ is the capability of manufacturing to produce goods and services.

  1. Capacity
  2. Priority
  3. Planning
  4. Control

________ is responsible for analyzing the marketplace and deciding the firm's response, the markets to be served, the products supplied, and desired levels of customer service.

  1. Marketing
  2. Finance
  3. Production
  4. Engineering

______ must satisfy the demands of the marketplace. It does so by using plants, machinery, equipment, labor, and materials as efficiently as possible.

  1. Marketing
  2. Finance
  3. Production
  4. Engineering

The _____________________ is a plan for the production of individual end items.

  1. MPS
  2. JIT
  3. MRP II
  4. MRP

Purchasing and ___________ represent the implementation and control phase of the production planning and control system.

  1. production activity control (PAC)
  2. material requirements planning (MRP)
  3. just-in-time (JIT)
  4. marketing

A _________ strategy means producing the amounts demanded at any given time.

  1. production leveling
  2. chase
  3. subcontracting
  4. TQM

In the _____________ environment, several product options exist (e.g., automobiles) and the customer is not willing to wait until the product is made. Therefore manufacturers produce and stock standard component parts.

  1. make-to-order
  2. assemble-to-order
  3. level production
  4. make-to-stock

____________ is the first step in a manufacturing planning and control system.

  1. Production planning
  2. Achieving the forecast
  3. Maintaining the required inventory levels
  4. Maintaining the planned backlog

The cost of a _________ that is too large equals the cost of turning away business.

  1. production plan
  2. backlog
  3. resource plan
  4. capacity plan

The MRP forms a vital link between sales and production as follows:

  1. The MRP makes possible valid order promises.
  2. The MRP is a plan of what is to be produced and when.
  3. The MRP is a contract between marketing and manufacturing.
  4. All of the above

The information needed to develop an MPR includes:

  1. The production plan
  2. Forecasts for individual end items
  3. Actual orders received from customers and for stock replenishments.
  4. All of the above

A schedule is satisfactory when:

  1. Capacity is greater than the production plan
  2. It doesn't specify to the plant when to start production
  3. Capacity is consistent with the production plan
  4. It doesn't specify to the plant when to stop production

The objectives in developing an MRP include:

  1. To maintain the desired level of customer service by maintaining finished goods inventory levels or by scheduling to meet customer delivery requirements
  2. To make the best use of material, labor, and equipment
  3. To maintain inventory investment at the required levels
  4. All of the above

To reach its objectives, the master production schedule must:

  1. Satisfy customer demand
  2. Be outside the capacity of manufacturing
  3. Be outside the guidelines of the production plan
  4. Be outside both the capacity of manufacturing and the guidelines of the production plan

The first step in preparing an MPS is:

  1. Resolve differences between the preliminary MPS and the capacity available.
  2. Check the preliminary MRP against available capacity.
  3. Develop a preliminary MRP.
  4. Develop a rough-cut capacity plan.

Critical resources in rough-cut capacity planning include:

  1. Bottle-neck operations
  2. Labor
  3. Critical materials
  4. All of the above

It is possible to increase the available capacity by:

  1. Using fewer workers
  2. Scheduling overtime
  3. Limiting subcontracting
  4. Rerouting away from other work centers

In the __________________ environment, many different end items are made from a small number of components.

  1. make-to-stock
  2. make-to-order
  3. assembly-to-order
  4. engineer-to-order

In the __________________ environment, many end items can be made from combinations of basic components and subassemblies.

  1. make-to-stock
  2. make-to-order
  3. assembly-to-order
  4. engineer-to-order

The sides, ends, legs, and tops of tables are ________ demand items.

  1. dependent
  2. independent
  3. forecast
  4. calculated

Since _______ demand is not related to the demand for any other assemblies or products, it must be ___________.

  1. dependent, forecast
  2. dependent, calculated
  3. independent, forecast
  4. independent, calculated

All major inputs to the MRP system include:

  1. Master production schedule and bill of material
  2. Bill of material and inventory records
  3. Inventory records and master production schedule
  4. Master production schedule, inventory records, and bills of material

The ___________ is a statement of which end items are to be produced, their quantity, and the dates they are to be completed.

  1. MRP
  2. MPS
  3. inventory record
  4. bill of materials

The bill of materials shows all the parts required to make __________.

  1. one item
  2. the MPR
  3. work-in-process inventory
  4. raw materials inventory

A _________ is used when companies usually make more than one product and the same components are often used in several products.

  1. single-level bill
  2. multiple bill
  3. multilevel bill
  4. product tree

Financially, inventories are very important to manufacturing companies and represent _________ of total assets on the balance sheet.

  1. 10% to 45%
  2. 25% to 40%
  3. 20% to 60%
  4. 50% to 80%

__________ are purchased items received that have not entered the production process. They include purchased materials, component parts, and sub-assemblies.

  1. Raw materials
  2. Work-in-process
  3. Finished goods
  4. MRO supplies

___________ include hand tools, spare parts, lubricants, and cleaning supplies. 

  1. Raw materials
  2. Work-in-process
  3. Finished goods
  4. MRO supplies

Inventory serves as a buffer between:

  1. Supply and demand
  2. Finished goods and component availability
  3. Customer demand and finished goods
  4. All of the above

__________ inventory is held to cover random unpredictable changes in supply and demand or lead time.

  1. Anticipation
  2. Fluctuation
  3. Lot-size
  4. Transportation

_______is a measure of customer service.

  1. Percentage of orders shipped on schedule
  2. Percentage of line items shipped on schedule
  3. Order-days out of stock
  4. All of the above

Storing inventory requires ___________________ and as inventory increases, so do these costs.

  1. space and workers
  2. workers and equipment
  3. space and equipment
  4. space, workers, and equipment

Liabilities are obligations or amounts owed by a company and include:

  1. Accounts payable
  2. Wages payable
  3. Long-term debt
  4. All of the above

The risks in carrying inventory are: 

  1. Obsolescence and damage
  2. Damage and pilferage
  3. Pilferage and deterioration
  4. Obsolescence, damage, pilferage, and deterioration

________ is the costs incurred in the process of making revenue.

  1. Income
  2. Cost of goods sold
  3. Expenses
  4. Retained earnings

A(n) _____________ lists all the parts needed to make one complete assembly.

  1. summarized parts list
  2. indented bill
  3. multilevel bill
  4. single-level bill

___________ is the process of multiplying the requirements by the usage quantity and recording the appropriate requirements throughout the product tree.

  1. Offsetting
  2. Planning orders
  3. Lead time
  4. Exploding

_______________ means that authorization is given to purchasing to buy the necessary material or to manufacturing to make the component.

  1. Planned order release
  2. Releasing an order
  3. Scheduled receipts
  4. Open orders

____________ are orders placed on manufacturing or on a vendor and represent a commitment to make or buy.

  1. Planned order releases
  2. Releasing orders
  3. Scheduled receipts
  4. Open orders

______________involves long-range capacity resource requirements and is directly linked to production planning.

  1. Resource planning
  2. MRP
  3. Capacity requirements planning
  4. Rough-cut capacity planning

Resource planning involves changes in staffing, capital equipment, product design, or other facilities that take a ________ time to ___________.

  1. short, acquire and eliminate
  2. long, acquire and eliminate
  3. short, utilize and change
  4. long, utilize and change

The inputs needed for a CRP include:

  1. Open shop orders
  2. Planned order released
  3. Routings
  4. All of the above

The Gregorian calendar:

  1. Has an equal number of days per month
  2. Spreads holidays evenly throughout the year
  3. Works on a decimal base
  4. Presents problems for manufacturing planning and control

Capacity needs to be measured:

  1. At the machine or individual worker level
  2. At the work center level
  3. At the plant level
  4. All of the above

_____________ is the number of hours a work center can be used.

  1. Demonstrated capacity
  2. Rated capacity
  3. Available hours
  4. Utilization

Rated capacity is calculated by taking into account the work center ___________.

  1. utilization and efficiency
  2. utilization and demonstrated capacity
  3. efficiency and production
  4. efficiency and demonstrated capacity

The term _____________means that the work center is overloaded and the term ________________ means the work center is under loaded.

  1. undercapacity, overcapacity
  2. overcapacity, under capacity
  3. overcapacity, utilization
  4. utilization, under capacity

In the _________ run, capacity ________ be adjusted.

  1. short, can
  2. short, cannot
  3. long, cannot
  4. none of the above

If the workload in a manufacturing plan cannot be changed, an alternative is to:

  1. Schedule overtime
  2. Schedule undertime
  3. Adjust the workforce by hiring
  4. All of the above

______________is concerned with the production of high-volume standard products.

  1. Flow manufacturing
  2. Intermittent manufacturing
  3. Product manufacturing
  4. All of the above

Routings are fixed and work centers are arranged according to the routing in ________________.

  1. flow manufacturing
  2. intermittent manufacturing
  3. product manufacturing
  4. all of the above

Flow of work through the shop is varied and depends on the design of a particular product. In _____________, as orders are processed, they will take more time at one workstation than at another. Thus, the work flow is not balanced.

  1. flow manufacturing
  2. intermittent manufacturing
  3. product manufacturing
  4. all of the above

An example of project manufacturing is:

  1. Gasoline
  2. Automobiles
  3. Appliances
  4. Large shipbuilding

The __________________ contains a list of the single-level components and quantities needed to assemble a parent item.

  1. work center master file
  2. item master file
  3. product structure file (bill of material file)
  4. routing file

The _________________ collects all of the relevant data on a work center.

  1. work center master file
  2. item master file
  3. product structure file (bill of material file)
  4. routing file

Each active manufacturing order has a record in the _____________________.

  1. work center master file
  2. item master file
  3. product structure file (bill of material file)
  4. shop order master file

_________ is the amount of time the job is waiting at a work center before an operation begins.

  1. Queue time
  2. Setup time
  3. Run time
  4. Wait time

The transit time between work centers is ____________.

  1. setup time
  2. run time
  3. wait time
  4. move time

_______________ is a method of reducing manufacturing lead time. The order is split into two or more lots and run on two or more machines simultaneously.

  1. Operation overlapping
  2. Operation splitting
  3. Infinite loading
  4. Backward scheduling

On average, manufacturing firms spend about ________ of their sales dollars on the purchase of raw materials, components, and supplies.

  1. 20%
  2. 50%
  3. 30%
  4. 40%

The objectives of purchasing include:

  1. Obtaining the goods and services at the highest price
  2. Obtaining goods and services of the lowest quality
  3. Ensuring the best possible service and prompt delivery by the supplier
  4. Obtaining goods and services at any quantity

A ________________ is a legal offer to purchase.

  1. quotation
  2. purchase order
  3. receiving order
  4. supplier's invoice

When the supplier's invoice is received, the following should agree:

  • The purchase order, the receiving report, and the invoice
  • The purchase order, the work order, and the production report
  • The receiving report, the quotation, and the material specification
  • The material specification, the purchase requisition, and the invoice

In purchasing an item or service from a supplier, which factor is not included when specifications are being developed?

  1. Delivery requirement
  2. Quantity requirements
  3. Price requirements
  4. Functional requirement

________ is the systematic use of techniques that identify a required function, establish a value for that function, and finally provide the function at the lowest overall cost.

  1. Cost analysis
  2. Functional analysis
  3. Value analysis
  4. Functional specifications

_______ is most often used in wholesale or retail businesses but is also used extensively in manufacturing.

  1. Description by brand
  2. Description by specification
  3. Description by function
  4. Description by buyer

___________specifications and standard specifications are the two major sources of specifications or ways of describing a product.

  1. Functional
  2. Buyer
  3. Marketing
  4. Production

______ sourcing is the use of more than one supplier for an item.

  1. Single
  2. Multiple
  3. Sole
  4. Engineering

Materials such as copper, coal, wheat, meat, and metals are:

  1. Standard products
  2. Items of small value
  3. Made-to-order items
  4. Commodities

_______________ occurs when a customer's order is received.

  1. Demand management
  2. Forecasting
  3. Random variation
  4. Order processing


  1. Are level
  2. Have no change from period to period
  3. Can rise or fall
  4. All of the above

______________ is usually thought of as occurring on a yearly basis, but it can also occur on a weekly or even daily basis.

  1. Seasonality
  2. Random variation
  3. A cycle
  4. A trend

Over a span of several years and even decades, wavelike increases and decreases in the economy influence demand and are called _________.

  1. seasonality
  2. random variation
  3. cycles
  4. trends

______________ demand items need to be forecast.

  1. Independent
  2. Dependent
  3. Both independent and dependent
  4. Neither independent nor dependent

The near future holds _____ uncertainty than (as) the far future.

  1. less
  2. more
  3. the same
  4. all of the above

_______________ techniques are projections based on judgment, intuition, and informed opinions.

  1. Extrinsic forecasting
  2. Quantitative forecasting
  3. Intrinsic forecasting
  4. Qualitative forecasting

The Delphi method:

  1. Uses a panel of experts who give their opinion on what is likely to happen
  2. Consists of projections based on external indicators that relate to the demand for a company's products
  3. Uses economic indicators, such as housing starts and gasoline consumption, to forecast demand
  4. Uses historical data to forecast demand

Products likely to have seasonal or periodic demand patterns include:

  1. Toilet paper and paper towels
  2. Toothpaste and deodorant
  3. Skis and lawnmowers
  4. Milk and meat

______________ exists when the cumulative actual demand varies from the cumulative forecast.

  1. Forecast error
  2. Random variation
  3. Mean absolute deviation
  4. Bias

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