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Test Bank for Introduction to Materials Management, 7th Edition: J. R. Tony Arnold

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Test Bank for Introduction to Materials Management, 7th Edition: J. R. Tony Arnold . Note : this is not a text book. Description: ISBN-10: 0131376705. ISBN-13: 9780131376700

 

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Introduction to Materials Management 7th Edition: J. R. Tony Arnold

CHAPTER 1: INTRODUCTION TO MATERIALS MANAGEMENT
1. Select the best answer to the following:
a. traditionally the supply-production-distribution functions have reported to different departments
b. the supply, production and distribution functions are part of a total system
c. materials flow into an organization, are processed in some way and distributed to the consumer
d. all the above are correct
e. none of the above is correct
2. Manufacturing is important to the economy because:
a. it generates wealth
b. it supports service industries c. it adds value to products
d. all of the above
e. none of the above
3. Which of the following is the best statement about the operating environment in which operations management functions?
a. most organizations do not need to worry about competition b. customers are more demanding
c. government regulation is not important for companies d. price is more important than quality
e. none of the above is true
4. Which of the following statements is best regarding order winners?
a. they persuade a company’s customers to choose its product b. they are the same in every market
c. they are the same as order qualifiers, only better d. they are present in every product
e. all the above are true
5. Which of the following strategies has the shortest delivery lead time and the least customer input?
a. engineer-to-order b. make-to-order
c. assemble-to-order d. make-to-stock

CHAPTER 2: PRODUCTION PLANNING SYSTEM

1. The ability of manufacturing to produce goods and services is called:
a. scheduling
b. production planning c. capacity
d. routing
e. none of the above
2. Priority in production planning relates to:
a. what should come first
b. how much of what is needed and when c. capacity
d. an objective of the firm e. none of the above
3. Which of the following is an input to the production plan?
a. strategic business plan b. financial plan
c. market plan
d. engineering plan
e. all of the above are inputs
4. Which of the following plans has the longest planning horizon and the least level of detail?
a. strategic business plan b. production plan
c. master production schedule
d. all of the above have the same level of detail e. none of the above
5. In terms of INCREASING level of detail, which is the best sequence of activities?
I. Material requirements planning. II. Master production scheduling. III. Production planning.
a. I, II and III b. I, III, and II c. II, III, and I d. II, I, and III e. III, II, and I
6. Over the time span of the production plan, which of the following can usually be varied to change capacity?
a. work force b. inventories
c. plant and equipment d. all of the above
e. a and b above
7. Which of the following is a characteristic of a production plan?
a. time horizons are five years
b. the production plan is for individual items
c. the only objective is to have an efficient plant
d. all of the above are characteristics of a production plan e. none of the above is characteristic of a production plan
8. Determining the need for labor, machines, physical resources to meet the production objectives of the firm is called:
a. production control
b. production planning c. capacity planning
d. all of the above
e. none of the above
9. The function of setting the limits or levels of manufacturing operations based on the market plan and resource availability is called:
a. production planning
b. production activity level c. capacity planning
d. all of the above
e. none of the above
10. A statement of a schedule of requirements for individual end items is called:
a. a master production schedule b. a material requirements plan c. a production plan
d. a capacity plan
e. none of the above

CHAPTER 3: MASTER SCHEDULING

1. The information needed to develop a master production schedule will be got from:
a. the production plan
b. the forecast of individual end items
c. inventory levels for individual end items d. all of the above
e. none of the above
2. The MPS is a vital link the production planning system because it: I. Keeps priorities valid.
II. Forms the basis for determining the capacity needed. III. Is input to the material requirements plan.
IV. Is input to the production plan. a. I, II, III and IV
b. I, II and III
c. I, II and IV
d. II, IIII and IV
e. 1, 3 and 4
3. The MPS:
a. facilitates order promising
b. works with individual end products
c. is an agreed-upon plan between production and marketing d. all of the above
e. none of the above
4. The functions of a master production schedule are to: I. Plan material components
II. Plan capacity requirements
III. Keep priorities valid a. I, II and III
b. I, II and not III c. I, III and not II d. II, III and not I
e. none of the above is a function of the MPS
5. Which of the following are objectives of an MPS?
I. Maintain the desired level of customer service. II. Keep the sales department happy.
III. Make the best use of material, labor and equipment. IV. Maintain inventory investment as required.
a. only I is an objective
b. only I and II are objectives
c. only I, II and III are objectives d. only I, III and IV are objectives e. only II, III and IV are objectives
6. The process of checking the MPS against available capacity is called:
a. capacity planning b. shop-floor control
c. rough-cut capacity planning d. capacity control
e. process checking
7. In an assemble-to-order company, at which level should master scheduling take place?
a. the component/subassembly level b. the end item level
c. the raw material/component level
d. it does not matter, any level will do e. none of the above levels
8. The final assembly schedule (FAS):
a. schedules customer orders as they are received based on components planned in the MPS
b. is used with make-to-order products c. is used with make-to-stock products d. a and b above
e. none of the above
9. Which of the following statements is best regarding the master production schedule?
a. it is an agreed-upon plan between marketing and manufacturing
b. if it is poorly done we can expect past-due schedules and unreliable delivery promises
c. it is a plan for specific end items that manufacturing expects to make over some period in the future
d. all of the above are true e. none of the above is true
10. The portion of inventory or production not committed to customer orders is called:
a. free stock
b. available to promise c. excess production
d. waste
e. excess capacity

CHAPTER 4: MATERIAL REQUIREMENTS PLANNING

1. is a set of priority planning techniques for planning component items below the:
a. Material requirements planning; end item level b. Master production scheduling; the market plan c. Production planning; end item level
d. all of the above
e. none of the above
2. The objectives of material requirements planning are to: a. issue orders to purchasing and manufacturing b. keep priorities current
c. determine requirements d. all of the above
e. b and c above
3. Which of the following is (are) elements in an MRP system?
a. the computer
b. bills of material
c. inventory records d. all of the above
e. none of the above
4. A set of priority planning techniques for planning component items below the end item level is called:
a. master scheduling
b. material requirements planning c. capacity planning
d. production control e. none of the above
5. A major input to an MRP system is:
a. the production plan b. the capacity plan
c. shop-floor activity planning and control d. the master schedule
e. none of the above
6. The document that shows the component parts and the number of parts needed to make one of an assembly or subassembly is called:
a. a route sheet
b. a material requirements plan c. a bill of material
d. a material requisition e. none of the above
7. A product tree shows:
a. the parts that go into making a product
b. the subassemblies used in making the product c. the sequence in which parts go together
d. all of the above
e. none of the above
8. Which of the following statements is best?
a. a part number identifies one part only
b. a part has one and only one part number
c. the same part on different bills of material will have the same part number d. all of the above are true
e. none of the above is true
9. A multi-level bill of material:
I. Reflects the way the product will be manufactured. II. Is produced by the engineering department.
III. Is a parts list only and does not contain subassemblies. a. only I is true
b. only II is true c. only III is true d. I and II are true
e. I, II and III are true
10. A bill of material whose purpose is to simplify forecasting, master production scheduling and material requirements planning is called:
a. a summarized parts list b. where-used bill
c. planning bill d. structured bill
e. multi-purpose bill

CHAPTER 5: CAPACITY MANAGEMENT

1. is responsible for determining the capacity required and with methods of making the capacity available.
a. Production planning
b. Master production scheduling c. Production activity control
d. Capacity planning
e. Material requirements planning
2. is responsible for capacity planning at the master production schedule level and at the material requirements planning level:
I. Resource planning.
II. Rough-cut capacity planning.
III. Capacity requirements planning. a. I and II
b. I and III
c. II and III
d. none of the above
3. Available capacity in production planning is:
a. the amount of inventory that can be held in a warehouse
b. the quantity of work that can be performed in a given period of time c. a measure of the ability of a plant to consume raw materials
d. all of the above
e. none of the above
4. are generated by the priority planning system and involve the translation of the priorities, generally given in units of product or some common unit, into hours of work required at each work center in each time period:
a. Capacity requirements b. Capacity bills
c. Work center reports d. all of the above
e. none of the above
5. Rated capacity is calculated taking into account work center and .
I. historical data
II. utilization
III. efficiency
a. I and II b. I and III c. II and III
d. none of the above
6. A work center consists of 2 machines working 8 hours a day and 5 days a week.
Historically, utilization has been 80% and the efficiency 90%. The effective capacity, to the nearest hour, would be:
a. 80 hours b. 40 hours c. 30 hours d. 50 hours e. 58 hours
7. The available capacity will be influenced by: I. Product specification.
II. Product mix. III. Work effort.
IV. Units of measurement a. I, II and III only
b. I, II and IV only
c. II, III and IV only d. III only
e. IV only
8. The percentage of time the work center is active compared to the available time is called:
a. efficiency
b. effectiveness c. utilization
d. Murphy’s factor e. up-time
9. The ratio of standard hours of work produced to hours actually worked is called:
a. efficiency
b. effectiveness c. utilization
d. Murphy’s factor e. up-time
10. Which of the following is NOT an input needed in capacity requirements planning?
a. open shop orders
b. planned order releases c. routings
d. time standards
e. rough-cut capacity

CHAPTER 6: PRODUCTION ACTIVITY CONTROL

1. is concerned with very short-term detailed planning of the flow of orders through manufacturing:
a. Production planning
b. Master production scheduling c. MRP
d. Production activity control e. Master planning
2. Planning the flow of work requires production activity control to: I. Be sure the material needed is available.
II. Be sure the tooling needed is available.
III. Schedule the start and stop dates at each work center. IV. Advise the plant supervisor of future orders.
a. all of the above b. I, II and III
c. I, II and IV
d. II, III and IV
e. I, III and IV
3. The activities of production activity control can be classified as: I. Planning.
II. Implementation. III. Control.
IV. Process control. a. I, II and III b. I, II and IV
c. II, III and IV
d. I, III and IV
e. all of the above
4. Work authorization can be classified under the function of:
a. planning
b. scheduling
c. implementation d. load leveling
e. control
5. Which of the following are characteristics of intermittent manufacturing?
I. Work centers are arranged according to the routing.
II. Work centers are dedicated to producing a limited range of similar products. III. Work flow through the shop is not constant.
IV. Throughput times are generally high. a. I and II
b. I and III c. I and IV d. II and III
e. III and IV
6. Which of the following files is used by PAC for planning?
I. Shop order master file. II. Shop order detail file. III. Item master file.
IV. Routing file.
a. all of the above will be used for planning b. I and II
c. I and III d. II and III e. III and IV
7. Which of the following files will contain information on manufacturing lead time and quantity on hand?
a. item master
b. bill of material c. work center file
d. shop order detail file
e. industrial engineer’s file
8. The shows the total standard time required to produce one end product in each work centre required for its manufacture:
a. work center bill b. routing file
c. capacity bill
d. bill of material
e. none of the above
9. Which file contains information on the efficiency and utilization of a work center?
a. efficiency file b. utilization file c. routing file
d. work center file e. either a or b
10. A shop order for 1000 pieces is to be processed on work station 123. The setup time is 4 hours and the run time per piece is .08 hours. What is the required capacity on this work center in standard hours?
a. 4.08
b. 0.08
c. 80
d. 84
e. 4000

CHAPTER 7: PURCHASING

1. Which of the following is an objective of purchasing?
I. Obtain goods and services of the required specification and quality. II. Obtain goods and services at the lowest cost.
III. Be sure the best possible service and delivery are provided by the supplier. a. I only
b. II only c. III only d. IV only
e. all are objectives of purchasing.
2. Which of the following is NOT a step in the purchasing cycle?
a. receipt and analysis of purchase requisition b. selection of vendor
c. make up the specification for the product d. issue a purchase order
e. receive and accept the goods.
3. Purchasing departments usually have the responsibility and authority to:
a. legally commit the company to a contract b. satisfy the needs of the user department
c. determine price and source d. all of the above
e. none of the above.
4. originates with the department or person who will be the ultimate user:
a. A purchase requisition b. A purchase order
c. Vendor selection d. any of the above
e. none of the above.
5. The decision on what is the “best buy” involves consideration of:
a. functional requirements b. price
c. quantity required d. all of the above
e. none of the above.
6. is concerned with the end use of the item and what it is expected to do:
a. Quantity required
b. Functional specification c. Production department d. all of the above
e. none of the above.
7. Which of the following is NOT a phase in providing user satisfaction?
I. Quality and production planning. II. Quality and product design.
III. Quality and manufacturing. IV. Quality and use.
a. all the above are phases in providing user satisfaction b. I only
c. II only d. III only e. IV only.
8. Functional specifications set out:
a. how the product is to work
b. the purpose for which the product is required
c. all those aspects or characteristics of a product that are determined by its final use
d. none of the above.
9. From the buyer’s point of view the best quality is:
a. the most expensive b. the least expensive
c. that which is best adapted to a particular use d. that which technically does the best job
e. none of the above.
10. Which of the following statements is best in describing quality by specification?
a. standard specifications are set by government and non-government agencies b. specifications are usually more costly to develop than using a brand
c. specifications tend to ensure more equitable competition d. all of the above are true
e. none of the above are true.

CHAPTER 8: FORECASTING

1. Which of the following statements is best statement about forecasting?
I. It must be done by all who wish to meet the demands of the future. II. Companies who make to order to NOT have to forecast.
a. I and II are true b. I only is true
c. II only is true
d. neither I nor II are true
2. Which of the following is NOT a component of a demand pattern?
a. trend
b. standard deviation c. seasonal variation d. random variation
e. all of the above are components of a demand pattern
3. Which of the following is the best statement about the general principles of forecasting?
a. forecasts are more accurate for larger groups of items b. forecasts are more accurate for nearer periods of time c. every forecast should include an estimate of error
d. all of the above are general principles of forecasting
e. none of the above is a general principle of forecasting
4. Which of the following statements is best?
a. dependent demand items should be forecast
b. a forecast for sales next week will not be as accurate as for a year from now c. forecasts for families of products should be built up from individual product
forecasts
d. all of the above are true e. none of the above is true
5. Which of the following statements is best?
a. if we wish to forecast demand, then past sales must be used for the forecast b. forecasts made in dollars for total sales should be used for manufacturing
c. forecasts should be made for all items, models, and options manufactured d. all of the above are true
e. none of the above is true
6. A firm manufactures a line of vacuum cleaners composed of standard, custom and deluxe models. All are essentially the same except for the options and add-ons. What should they forecast?
a. the total of all models b. each model
c. each model and add the forecasts together d. all of the above
e. none of the above
7. Which of the following is NOT true?
a. number of orders shipped is a good measure of demand for an item b. circumstances relating to historical data should be recorded
c. demand for different groups should be recorded separately d. none of the above is true
8. Which of the following statements is best regarding forecasting techniques?
a. qualitative techniques are based on judgment
b. techniques that use external economic indicators are classified as extrinsic c. intrinsic techniques use historical data
d. all of the above are true e. none of the above is true
9. What important assumption is made about statistical (quantitative) forecasting methods?
a. the past is a valid indicator of the future b. demand trend is seldom linear
c. seasonal variations are small d. random variations are small e. all of the above
10. Which of the following methods can be used to forecast the demand for a NEW product?
a. equation fitting
b. moving averages
c. qualitative techniques d. all of the above
e. none of the above

CHAPTER 9: INVENTORY FUNDAMENTALS

1. Which of the following statements is best about inventory management?
a. inventories and production can be managed separately
b. inventory is not important at the production planning level c. inventories are usually insignificant on the balance sheet
d. all the above are true
e. none of the above is true
2. are materials that have entered the production process and are materials that are used in the production process but do not become part of the product.
I. Raw materials
II. Work in process
III. Finished goods
IV. Maintenance, repair and operational supplies a. I and II
b. II and III c. III and IV d. I and III
e. II and IV
3. Inventories that are built up in advance of a peak selling season, a promotion program or a plant shut-down are known as:
a. lot-size inventories
b. transportation inventories c. safety stocks
d. anticipation inventories e. none of the above
4. Transportation inventories can be reduced by:
a. reducing transportation time b. reducing order quantities
c. increasing order quantities d. reducing the order point
e. none of the above
5. Items that are purchased or manufactured in quantities greater than needed immediately create inventories:
a. anticipation b. lot size
c. hedge
d. any of the above e. none of the above
6. Select the one best of the following statements:
a. inventories allow manufacturing to level out production and to satisfy peak demand
b. inventories allow manufacturing to reduce production runs, reducing unit cost c. inventories allow manufacturers to operate different work centers at the same
output
d. all the above are true
e. none of the above is true
7. Which of the following company objectives are in conflict?
I. Maximize customer service. II. Low-cost plant operation.
III. Minimum inventory investment. a. I, II and III
b. I and II, not III c. I and III, not II d. II and III, not I e. none
8. In managing inventory, the problem is to balance the inventory investment with: I. Customer service.
II. Costs associated with changing production levels. III. Costs of placing orders.
IV. Transportation costs. a. II and III only
b. III and IV
c. I, II and III only
d. II, III and IV only e. I, II, III, and IV
9. Which of the following costs are relevant to inventory management decisions?
a. carrying costs b. ordering costs
c. capacity-related costs d. all the above
e. none of the above
10. Which of the following is NOT a cost of carrying inventory?
a. capital costs b. storage costs c. purchase cost d. all the above
e. none of the above

CHAPTER 10: ORDER QUANTITIES

1. Which of the following are NOT assumptions on which the economic order quantity (EOQ)
is based?
a. demand is relatively constant and known b. the item is produced continuously
c. order preparation costs, inventory carrying costs and lead times are constant and known
d. replacement occurs all at once
e. all of the above are true assumptions
2. In developing the standard economic order quantity formula the following assumption(s) is
(are) made:
a. demand for the item is relatively uniform
b. replenishment is in lots or batches that arrive at once c. lead time is constant
d. all of the above are assumed e. none of the above is assumed
3. In determining the economic order quantity (EOQ) the following costs are considered:
a. costs of a stockout and ordering costs
b. costs of a stockout and inventory holding costs c. ordering costs and inventory carrying costs
d. ordering costs and costs of changing production levels
e. inventory holding costs and costs of changing production levels
4. If the order quantity is increased the annual cost of carrying inventory will:
a. increase b. decrease
c. remain the same d. not be affected
e. none of the above
5. Assuming the cost per order is constant, increasing the order quantity will cause annual ordering costs to:
a. decrease b. increase
c. remain the same
d. increase at a decreasing rate e. cannot be determined
6. In the simple EOQ model annual inventory carrying costs and annual ordering costs vary:
a. according to the time of year
b. with seasonally adjusted demand c. with the order quantity
d. do not vary in any way e. in an unknown manner
7. While working a simple EOQ problem, you notice that, with a certain lot size, the annual ordering cost is exactly the same value as the annual inventory carrying cost. Which of the following is true?
a. the lot size is the economic order quantity b. total cost is at its maximum
c. the annual carrying cost will decrease if the order quantity is increased d. all of the above
e. none of the above; the phenomenon is merely a coincidence
8. A firm uses $20,000 of an item per year. The carrying cost is 25%, the cost of ordering is
$10 and the order quantity is $1,000. The annual total cost of carrying plus ordering would be:
a. $2,500
b. $5,000
c. $100
d. $325
e. none of the above
9. For a particular item the usage is 2000 units per year, the ordering cost is $10, the inventory carrying cost is 20% and the unit cost is $5. The economic order quantity is:
a. 20 units b. 200 units c. 2000 units d. 400 units e. 4000 units
10. If the economic order quantity is to be calculated in DOLLARS, then:
a. the annual demand must be stated in dollars
b. ordering costs MUST be stated on a per UNIT basis c. carrying costs are stated in dollars per unit
d. all the above are true
e. none of the above is true

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