2009 APICS The Association for Operations Management

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1 Acknowledgment APICS has developed these practice questions for the Detailed Scheduling and Planning module of the Certified in Production and Inventory Management program. The 60 questions, similar to those found in the certification exam, were compiled by the Detailed Scheduling and Planning Committee of the Curricula and Certification Council. The practice questions are accompanied by an answer key and text references for additional study. APICS acknowledges the Detailed Scheduling and Planning Committee for its contributions to this resource. Ann K. Gatewood CFPIM, CIRM(chair) Sarah W. Klunk, CFPIM, CSCP, CIRM, C.P.M Blair Williams, CFPIM, CSCP, Jonah Donna Schmoll, CPIM 2009 APICS The Association for Operations Management No part of this publication covered by the copyright herein may be reproduced or copied in any form or by any means without the written permission of the publisher. APICS The Association for Operations Management 8430 West Bryn Mawr Avenue Suite 1000 Chicago, IL Phone: or Fax: Stock #09211, 01/09

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3 Important Information Regarding these Practice Questions One important way to prepare for the APICS CPIM examinations is to simulate the test experience by taking a series of practice questions. One of the benefits of using the practice questions is familiarizing yourself with the types of questions encountered in an actual APICS certification examination. There is no correlation between the number of practice questions you answer correctly and your success under actual examination conditions, but your understanding of typical question formats can make the actual examination less stressful. Please be aware that these practice questions have been retired from previous examinations. In most cases, the questions had been used an optimal number of times and were replaced by questions that had enjoyed less exposure. For this reason, the questions may not have been developed using the references currently cited in the APICS Examination Content Manual as primary or additional references. The questions themselves have been reviewed for currency by the appropriate committee of the APICS Curricula and Certification Council. The practice questions in this publication have been selected to represent the topical distribution of the questions that you can expect to encounter in the examination. To assist you in a general understanding of how test questions are related to the reference materials used in their creation, the answer key provides the page numbers of the source reference material. However, unless they are identified in the current Examination Content Manual, do not assume that the references listed in this publication are appropriate for use as study materials. For more information about the APICS CPIM examinations, please visit the Certification section of the APICS website (

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5 Detailed Scheduling and Planning Practice Questions 1 Detailed Scheduling and Planning Practice Questions 1. The Maynard Company has five distribution centers for their air conditioner and other home heating units such as furnaces and water heaters. Which of the following review methodologies or techniques is easiest to use for the common-thickness sheet metal used in fabricating these units? (A) Material requirements planning (B) Reorder point (C) Time-phased order point (D) Visual 2. Using phantom bills of material will result in which of the following? A) Fewer inventory transactions and work orders B) Simpler product structures and smaller lot sizes C) Fewer inventory transactions and smaller lot sizes D) Fewer work orders and simpler product structures 3. The most desirable initial attribute in suppliers of companies that adopt lean manufacturing is (A) kanban quantity (B) consistent quality (C) competitive pricing (D) adequate capacity 4. A company uses material requirements planning for an electronic product family. Which of the following ordering techniques is MOST likely to already incorporate the rounding factor for a part where inventory is in units and purchase orders are in cartons of 100? (A) economic (B) fixed (C) lot-for-lot (D) period 5. Which of the following will reduce nervousness of the MRP system? A) Removing time fences B) Reducing resource capacity C) Using firm planned orders D) Introducing more safety stocks 6. Which of the following statements about capacity requirements planning are true? I. It uses both open and planned orders in projecting capacity needs. II. It is much less detailed than rough-cut capacity planning. III. It considers orders for end items in its calculations. IV. It considers orders for components in its calculations. (A) I and IV only (B) II and III only (C) I, III, and IV only (D) I, II, III, and IV

6 2 Detailed Scheduling and Planning Practice Questions 7. When considering whether to outsource an item, the most important factor would be (A) specialized technical expertise (B) managerial costs (C) transportation costs (D) price 8. Which of the following most lends itself to an engineer-to-order production environment where cost of obsolescence of unique items is a significant issue? (A) batch (B) continuous (C) lot (D) price break 9. Errors in the material requirements plan can result from data inaccuracies in all of the following EXCEPT (A) component lead times (B) inventory balances (C) bills-of-material structure (D) manufacturing routings 10. Materials should be moved from point of manufacture to point of use when (A) production is completed at point of manufacture (B) the materials are needed at point of use (C) material handling equipment is available (D) material at point of use is zero 11. A company uses material requirements planning and reorder point. Which of the following MOST relates to the planner's ability to determine the source of gross requirements for a part having both dependent and independent demand? (A) Planners do not normally use or understand time-phased order point. (B) Independent demand cannot be imploded to identify the parent. (C) There is no easy way to separate independent from dependent demand. (D) Independent demand has no source and no gross requirements. The following information is to be used for question 12. Level Part Quantity per 0 A not applicable 1 B 2 2 C 2 2 E 2 1 C 4 1 G How many units of part C are required to produce one unit of part A? (A) 2 (B) 4 (C) 6 (D) 8

7 Detailed Scheduling and Planning Practice Questions Strategic sourcing is focused on (A) stable pricing (B) transactions (C) acquiring goods and services (D) order execution 14. Increasing the capacity at an intermediate bottleneck work center results in all of the following EXCEPT (A) an increase in the throughput of the system (B) a decrease in work in process in the system (C) a rescheduling of the existing load (D) a reprioritization of existing queues 15. For a consistently high-volume independent demand part, which of the following safety stock techniques is MOST likely to ensure a high customer service level while having no association with the company's target customer service level? (A) Economic (B) Fixed (C) Statistical (D) Time period 16. During the MRP planning process, the key purpose of the bill of material is to provide (A) a pick list to show the number of components needed for an item (B) product structure records to guide the explosion process (C) documents to be used primarily for engineering and costing references (D) product details used to determine the production sequence 17. Objectives of the total capacity requirements planning process include all of the following EXCEPT (A) adjustment of work plans for effective use of capacity (B) alteration of the master production schedule for effective use of capacity (C) determination of the people and/or machines needed to make the products in the master production schedule (D) determination of the materials needed to make the products in the master production schedule 18. Which of the following is the MOST likely reason for using a safety lead time instead of a safety stock? (A) The part stocks out too frequently. (B) Carrying safety stock is too expensive. (C) Supply variability is the concern. (D) Demand variability is too biased.

8 4 Detailed Scheduling and Planning Practice Questions 19. In the product above, the numerical low-level code that would be assigned for Item 7 would be (A) 0 only (B) 1 only (C) 4 only (D) both 1 and Work center data can be used to develop information to support which of the following activities? I. Operation scheduling II. Capacity Planning III. Priority setting IV Performance reporting (A) I and II only (B) III and IV only (C) I, II and IV only (D) I, II, III and IV 21. Price analysis should be done for (A) all requisitions (B) every significant purchase (C) MRO items only (D) non-mro items 22. Classifying most materials as A items will result in (A) creating focus for critical materials (B) significant cost savings (C) lack of focus and attention (D) a Pareto analysis 23. Lead-time offsetting can be described as (A) positioning the planned order release in advance of the date of need by the length of the lead time (B) adding some safety time to lead time to offset unforeseen manufacturing problems (C) scheduling material to be delivered earlier than called for by the requirements plan (D) compensating for the difference between actual and planned lead times

9 Detailed Scheduling and Planning Practice Questions Which principle of supplier partnerships is LEAST important? (A) compatibility of interests (B) pricing (C) mutual need (D) trust 25. Unique quality control requirements, design security, and full plant capacity would tend to push an item to be a (A) subcontract item (B) make part (C) buy part (D) forecasted item 26. The main reason for the MRP level-by-level explosion process is to (A) provide time-phased schedules (B) accumulate higher-level requirements before netting (C) allow pegging (D) avoid exploding product by product 27. An order is received for 3600 items to be produced in a process that has an unavoidable scrap loss of 10 percent. What quantity should be started? (A) 3600 (B) 3960 (C) 4000 (D) Which of the following accounting methods results in no change in inventory value regardless whether material costs are increasing or decreasing? (A) actual cost (B) average cost (C) process cost (D) standard cost

10 6 Detailed Scheduling and Planning Practice Questions The following information is to be used for question 29. Lot Size: 120 Allocated: 0 Safety Stock: 10 Lead Time: 3 Periods Gross Requirements Scheduled Receipts 100 Projected On-hand Projected Available Net Requirements Planned Order Receipts Planned Order Releases The situation presented in the chart above is in proper balance. If the demand in the second period were to be changed from 40 to 60, which of the following would be true? (A) The on-hand would reach 0 in Period 3, but no action would be recommended because the gross requirements would still be covered. (B) A recommendation to reschedule the scheduled receipt of 100 for Period 4 to Period 3 would be made with no other changes needed. (C) A recommendation to reschedule the scheduled receipt of 100 for Period 4 to Period 3 and to move the planned order release for 120 in Period 3 to Period 2 would be made. (D) A recommendation to increase the scheduled receipt of 100 to 120 and to reschedule it from Period 4 to Period 3 would be made. 30. The goal of a supplier evaluation system is to (A) ensure supplier is meeting the needs of the buyer (B) provide a basis for cost reductions (C) emphasize price-oriented measures (D) focus on on-time delivery 31. A company is introducing a new product. There is expected to be service part and warranty demand for one of the components. There is no historical basis for forecasting what this may be as the company has no similar products. Which of the following is the BEST way to account for this projected demand? (A) Over-plan end-item at the master production schedule level (B) Carry safety stock at the end-item level from a forecast (C) Purchase extra quantity of the component as a one-time buy (D) Forecast component through master production schedule

11 Detailed Scheduling and Planning Practice Questions MRP explosion is the process of (A) extending requirements from parent to component (B) detailing the timing of requirements (C) calculating net requirements from gross requirements and on-hand (D) expanding requirements to cover in-process losses 33. Immediate inputs to capacity requirements planning include which of the following? I. Master production schedule II. Planned orders III. Scheduled receipts (A) III only (B) I and II only (C) I and III only (D) II and III only 34. Which of the following is the MOST important reason why stockout duration is important when considering the customer service level? (A) Stockout duration is most likely associated with the number of orders shipped late. (B) Stockout duration is assumed to be constant so variability affects customer service level. (C) Stockout duration is important because customer service isn't 100% until all line items ship. (D) Stockout duration is immaterial as it is not related to the number of exposures to stockout. 35. The three primary inputs to an MRP system are (A) bills of material, inventory status, and master production schedule (B) bills of material, product structure trees, and inventory status (C) bills of material, customer orders, and master production schedule (D) product structure trees, master production schedule, and lot sizes 36. The greatest advantage of a blanket order is that it (A) consolidates small repetitive buys over time (B) is used for inexpensive supply items only (C) is used for MRO items (D) reduces control 37. Which of the following lot sizing techniques is MOST likely to require a Maximum Days Supply constraint for a low cost C item used in a previously high volume product that is being phased out? (A) economic order quantity (B) time-period (C) fixed (D) lot-for-lot

12 8 Detailed Scheduling and Planning Practice Questions The following information is to be used for question 38. Lot Size: 50 Allocated: 0 Safety Stock: 0 Lead Time: 1 Periods Gross Requirements Scheduled Receipts Projected On-hand 50 Projected Available Net Requirements Planned Order Receipts Planned Order Releases 38. According to the information above, the MRP results of processing would recommend that which of the following be done? I. Cancel scheduled receipt in Period 2 II. Reschedule scheduled receipt out to Period 5 III. Plan to release an order in Period 4 IV. Plan to release an order in Period 5 (A) (B) (C) (D) III only IV only I and III only II and IV only This chart is to be used for questions 39 and At the end of Week 4, the projected queue at this station is how many hours? (A) 0 (B) 10 (C) 30 (D) 50

13 10 Detailed Scheduling and Planning Practice Questions 47. Accurate inventory levels are mostly influenced by which of the following items? (A) Longer forecast horizons (B) Cycle counts (C) Bill of material maintenance (D) Annual physical inventory 48. Allowances for scrap/yield estimates in the manufacture of a component require overplanning of (A) parent safety stock (B) component planned releases (C) parent planned releases (D) component planned receipts 49. The process of concurrent engineering refers to (A) several new technologies developed independently (B) prototyping development (C) several teams working simultaneously (D) matrix management 50. Which of the following manufacturing environments would best serve the needs of customers of variable products that are configured to meet specific user requirements? (A) engineer-to-order (B) make-to-order (C) assemble-to-order (D) make-to-stock 51. Firm planned orders are useful for doing which of the following? I. Preventing the system from automatically rescheduling II. Creating a planned order that does not agree with the lot sizing rule for that item III. Preventing the explosion of requirements at lower levels IV. Freezing the timing of a planned order release (A) I only (B) III and IV only (C) I, II, and IV only (D) I, II, III, and IV 52. Which of the following best describes a work center? (A) a group of machines that may be considered as identical for the purpose of scheduling (B) a grouping of general purpose machines within a large plant (C) a department or section of the factory in which a specific product is made (D) a small, versatile machine shop 53. Planning of additional materials in excess of what is needed to satisfy gross requirements is also known as: (A) forward scheduling (B) pipeline inventory (C) independent demand (D) safety stock

14 Detailed Scheduling and Planning Practice Questions If a 5-week queue is desired at the end of Week 4, the average capacity should be (A) 10 (B) 20 (C) 25 (D) Which of the following demand fulfillment approaches typically generates the longest delivery time? (A) engineer-to-order (B) make-to-order (C) assemble-to-order (D) make-to-stock 42. One of the key abilities of an MRP system is to (A) compute open order priorities using a dynamic priority ratio (B) control the sequence of work being performed on the shop floor (C) compute operation priorities using a standard backward-scheduling technique (D) help keep the due dates valid for all open orders 43. The supplier in a new product introduction can reduce time to market by (A) automating production processes (B) early involvement (C) making hard tooling (D) developing new technology 44. A make-to-stock company is considering improving its customer service level through a combination of shipping from finished goods and shipping from final assembly and test. Which of the following is MOST likely to be an inventory management consideration with regards to this new strategy? (A) Current customer service level (B) End items being considered (C) Production responsiveness (D) Manufacturing strategy 45. The term full pegging, as contrasted with single-level pegging, implies which of the following? (A) Requirements for all items in the system are pegged. (B) Open orders, as well as gross requirements, are pegged to planned and open orders at the parent level. (C) Item requirements are pegged directly to customer order or end-item lots in the master production schedule. (D) Item requirements are pegged to planned orders, to net requirements, and to gross requirements at the parent level. 46. For a job shop, the most appropriate units of measure for capacity requirements planning are (A) dollars (B) product family units (C) standard hours (D) pieces

15 Detailed Scheduling and Planning Practice Questions Which of the following problems could result from inaccurate bills of material? (A) inaccurate on-hand inventory balances (B) an overstated master production schedule (C) inaccurate raw material requirements (D) invalid operation due dates 55. When kanbans are used for an outside supplier, an empty bin communicates to the supplier (A) that the order is complete (B) to ship another bin of parts (C) to buy more raw materials (D) to decrease production 56. What technique best determines production and inventory quantities for goods and services with independent demand? (A) safety stock (B) forecast (C) material requirements planning (D) capacity requirements planning 57. Giving suppliers projections of future orders provides support for which of the following supplier activities? I. Workforce stabilization II. Raw material cost reduction III. Capacity utilization improvement (A) I only (B) III only (C) II and III only (D) I, II, and III 58. The equation used to calculate actual labor hour requirements is (A) Standard hours x (efficiency x utilization) (B) Standard hours divided by (efficiency x utilization) (C) Standard hours divided by utilization (D) Standard hours divided by (efficiency minus utilization) 59. MRP provides planned order information for which of the following? I. Lower-level requirements II. Operation due dates III. Capacity requirements planning (A) I and II only (B) I and III only (C) II and III only (D) I, II, and III 60. Determining labor productivity requires information about all of the following EXCEPT (A) pieces input (B) pieces output (C) total hours worked (D) standard hours per piece