Which of the Following Statements Is True About Open Loop

question 44

Multiple Choice

Which of the following statements is true about open loop MRP systems?

• A)There are provisions for feedback.
• B)Plans and schedules are developed assuming finite capacity.
• C)Plans and schedules are developed assuming on-time,correct delivery of materials ordered by suppliers.
• D)Schedules are maintained by adjusting production plans when changes in demand occurred.

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Definitions:

Direct Labor-Hours

A measure of the total hours worked directly on the production of goods.

Budget Variances

The difference between budgeted and actual figures for revenues or expenditures, indicating under or overspending.

Underapplied

A situation where the allocated manufacturing overhead costs are less than the actual overhead costs incurred, leading to underestimation of product costs.

Overapplied

A condition where the allocated amount of indirect costs exceeds the actual amount incurred.