Which of the following statements is TRUE about the MRP plan when using lot-for-lot ordering?
A)The quantity of gross requirements for a child item is always equal to the quantity of planned order releases for its parent.
B)The quantity of gross requirements for a child item is equal to the quantity of planned order release(s)multiplied by the number of child items used in the parent assembly.
C)The quantity of gross requirements for a child item is always equal to the quantity of gross requirements for its parent.
D)The quantity and gross requirements for a child item is always equal to the quantity of net requirements for its parent.
E)All of the above are true.

Question

Quizplus · Accepted Answer

Lot-for-lot ordering is a type of MRP plan in which the planned order quantity for a component is equal to the net requirements for that component. In other words, the quantity of gross requirements for a child item is equal to the quantity of planned order release(s) multiplied by the number of child items used in the parent assembly. Hence, option B is the correct answer. Option A is incorrect because planned order releases may not always equal gross requirements. Option C is incorrect because the gross requirements of a child item are not always equal to the gross requirements of its parent. Option D is also incorrect because net requirements of the parent do not always equal the gross requirements of a child item.

Which of the Following Statements Is TRUE About the MRP