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1. Subject: Material Management Marks : 100
Note: 1) Attempt any Eight Questions.
2) All questions carry equal Marks
1. What is supply chain? Describe five important factors in supply chains.
2. A company wants to develop a level production plan for a family of products. The
opening inventory is 600 units, and a decrease to 200 units is expected by the end of the
plan. The demand for each of the months is given in what follows. How much should the
company produce each month? What will be the ending inventory in each month? Do you
see any problems with the plan?
Month Jan Feb Mar Apr May June Total
Working Days 20 22 20 20 18 19
Forecast Demand 1200 1300 800 700 700 900
Planned Production
Planned
Inventory
500
3. What are the major inputs to the MRP system?
4. Define “capacity available” what are the four factors that affect it?
5. If purchase were 45% of sales and other expenses were 45% of sales, what would be the
increase in profit if, through better purchasing, the cost of purchases was reduced to 43%
of sales?
6. What is bias error in forecasting? What are some of the causes?
7. Define each of the following in your own words and as a formula:
a. Annual ordering cost
b. Annual Carrying cost
c. Total annual cost.
8. Why is cycle counting a better way to audit inventory records than an annual physical
inventory?
9. Describe general-purpose and special-purpose machinery. Compare each for flexibility of
use, operator involvement, run time per piece, setup time, quality, capital cost and
application.
10. What is the difference between ISO 9001, 9002 and 9003?