The CRP system converts tentative planned shop orders into standard hours of load by ______.
A)assessing the levels of inventory of finished product,given the availability of raw materials
B)multiplying each period's production quantity requirements by standard labor or equipment requirements per unit,or both
C)averaging the availability of resources per production hour
D)basing the calculations on the production volume from the preceding production period

Question

Quizplus · Accepted Answer

The CRP system converts tentative planned shop orders into standard hours of load by multiplying each period's production quantity requirements by standard labor or equipment requirements per unit or both. This step allows the system to determine the loading on the work centers and capacity needed to fulfill the production requirements. This calculation helps in identifying the capacity constraints and helps in scheduling the production accordingly. Option A is incorrect because assessing the levels of inventory of finished products is not related to the conversion of planned orders into standard hours of load. Option C is incorrect as averaging the availability of resources per production hour is not a step in converting planned orders into standard hours of load. Option D is also incorrect as basing the calculations on the production volume from the preceding production period does not help in determining the standard hours of load for the current period.

The CRP System Converts Tentative Planned Shop Orders into Standard