Explain What Is Meant by "Nervousness" of the MRP Schedule

question 6

Essay

Explain what is meant by "nervousness" of the MRP schedule. Provide an example. Name two tools that are particularly useful in reducing system nervousness in MRP systems.

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Definitions:

Activity-based Factory Overhead

A method of allocating overhead costs based on each product's activities, aiming to accurately distribute expenses related to manufacturing.

Activity-based Costing

A costing method that identifies activities in a company and assigns the cost of each activity to all products and services according to the actual consumption by each.

Shipping and Handling Activity

The process of preparing, packaging, and delivering goods to a destination.

Activity Rate

A metric used to measure the efficiency or productivity of a company's operations, often tied to specific actions or tasks.