APICS CPIM PART 2 STUDY REVIEW SOLUTION 2022
14 Points - W. Edwards Deming's 14 management practices to help companies
increase their quality and productivity
A3 Method - A means of compactly describing a business process
Abnormal Demand - Demand in any period that is outside the limits established by
management policy
Absorption Costing - An approach to inventory valuation in which variable costs and a
portion of fixed costs are assigned to each unit production.
Acceptable Quality Level (AQL) - When a continuing series of lots is considered, a
quality level that, for the purposes of sampling inspection, is the limit of a satisfactory
process average
Acceptance Sampling - the process of sampling a portion of goods for inspection rather
than examining the entire lot
Action Message - An output of a system that identifies the need for, and the type of
action to be taken to correct, a current or potential problem.
Activation - Putting a resource to work
Activity-Based Cost Accounting - A cost accounting system that accumulates costs
based on activities performed and then uses cost drivers to allocate these costs to
products or other bases such as customers, markets, or projects. It attempts to allocate
overhead costs on a more realistic basis than by using direct labor or machine hours
Activity-Based Management (ABM) - The use of activity-based costing information
about cost pools and drivers, activity analysis, and business processes to identify
business strategies; improve design, manufacturing, and distribution; and remove waste
from operations
Actual Costs - The labor, material, and associated overhead costs that are charged
against a job as it moves through the production process
Actual Demand - Composed of customer orders (and often allocation of items,
ingredients or raw materials to production or distribution). Nets against or chosen over a
time horizon.
Adaptive Smoothing - A form of exponential smoothing in which the smoothing constant
is automatically adjusted as a function of forecast error measurement
,Adjustable Capacity - Capacity, such as labor or tools, that can be changed in the short
term
Advanced planning and scheduling (APS)/Advanced Planning Systems (APS) -
Techniques that deal with analysis and planning of logistics and manufacturing during
short, intermediate, and long-term time periods.
Aggregate Forecast - An estimate of sales, often time-phrased, for a grouping of
products or product families produced by a facility or firm. Stated in terms of units,
dollars, or both, the aggregate forecast is used for sales and production planning
purposes
Aggregate Plan - A plan that includes budgeted levels of finished goods, inventory,
production backlogs, and changes in the workforce to support the production strategy.
Aggregated information rather than product information is used
Agility - The ability to quickly plan, source, make, and deliver to adapt and respond to
changes in the competitive environment. It is a SCOR performance attribute that
includes product or service flexibility (speedy introduction of new products and
services), mix flexibility (ability to quickly change products or services offered), volume
flexibility (ability to service large order quantities), and delivery flexibility (ability to
quickly change delivery dates to meet new requirements)
Allocation - The classification of resources or items quantities that have been assigned
to specific orders but have not yet been released from the stockroom to production. It is
an "uncashed" stockroom requisition. 2. A process used to distribute material in short
supply
Alpha Factor/Smoothing Constant - In exponential smoothing, the weighting factor that
is applied to the most recent demand, observation, or error
Alternate Operation - Replacement for a normal step in the manufacturing process
Alternate Routing - A routing that is usually less preferred than the primary routing but
results in an identical item. Alternate routings may be maintained in the computer or off-
line via manual methods, but the computer software must be able to accept alternate
routings for specific jobs
Analysis of Variance (ANOVA) - A statistical analysis system that estimates what
portion of variation in a dependent variable is caused by variation in one or more
independent variables. It also produces a number used to infer whether any or all of the
independent-dependent variable relationships have statistical significance
Andon - A sign board with signal lights used to make workers and management aware
of a quality, quantity, or process problem
, Anticipated Delay Report - A report, normally issued by both manufacturing and
purchasing to the material planning function, regarding jobs or purchase orders that will
not be completed on time. This report explains why the jobs or purchases are delayed
and when they will be completed. This report is an essential ingredient of the closed-
loop MRP system. It is normally a handwritten report
Appraisal Costs - Those costs associated with the formal evaluation and audit of quality
in the firm. Typically costs include inspection, quality audits, testing, calibration, and
checking time
Assignable Cause - A source of variation in a process that can be isolated, especially
when its significantly larger magnitude or different origin readily distinguishes it from
random causes of variation
Attribute Data - Go/no-go information. The control charts based on attribute data include
percent chart, number of affected units chart, count chart, count-per-chart, quality score
chart, and demerit chart
Availability - The percentage of a time that a worker or machine is capable of working.
Availability Formula - = (S-B)/S x 100% where S is the scheduled time and B is the
downtime
Available Capacity - The capability of a system or resource to produce a quantity of
output in a particular time period
Available Time - The number of hours a work center can be used, based on
management decisions regarding shift structure, extra shifts, regular overtime,
observance of weekends and public holidays, shutdowns, and the like
Backflush Costing - The application of costs based on the output of a process. Is usually
associated with repetitive manufacturing environments
Backward Integration - The process of buying or owning elements of the production
cycle and channel of distribution back toward raw material suppliers
Backward Scheduling/Back Scheduling - A technique for calculating operation start
dates and due dates. The schedule is computed starting with the due date for the order
and working backward to determine the required start date and/or due dates for each
operation
Balanced Scorecard - A list of financial and operational measurements used to evaluate
organizational or supply chain performance. The dimensions might include customer
perspective, business process perspective, financial perspective, and innovation and
learning perspectives. Formally connects overall objectives, strategies, and
measurements.
14 Points - W. Edwards Deming's 14 management practices to help companies
increase their quality and productivity
A3 Method - A means of compactly describing a business process
Abnormal Demand - Demand in any period that is outside the limits established by
management policy
Absorption Costing - An approach to inventory valuation in which variable costs and a
portion of fixed costs are assigned to each unit production.
Acceptable Quality Level (AQL) - When a continuing series of lots is considered, a
quality level that, for the purposes of sampling inspection, is the limit of a satisfactory
process average
Acceptance Sampling - the process of sampling a portion of goods for inspection rather
than examining the entire lot
Action Message - An output of a system that identifies the need for, and the type of
action to be taken to correct, a current or potential problem.
Activation - Putting a resource to work
Activity-Based Cost Accounting - A cost accounting system that accumulates costs
based on activities performed and then uses cost drivers to allocate these costs to
products or other bases such as customers, markets, or projects. It attempts to allocate
overhead costs on a more realistic basis than by using direct labor or machine hours
Activity-Based Management (ABM) - The use of activity-based costing information
about cost pools and drivers, activity analysis, and business processes to identify
business strategies; improve design, manufacturing, and distribution; and remove waste
from operations
Actual Costs - The labor, material, and associated overhead costs that are charged
against a job as it moves through the production process
Actual Demand - Composed of customer orders (and often allocation of items,
ingredients or raw materials to production or distribution). Nets against or chosen over a
time horizon.
Adaptive Smoothing - A form of exponential smoothing in which the smoothing constant
is automatically adjusted as a function of forecast error measurement
,Adjustable Capacity - Capacity, such as labor or tools, that can be changed in the short
term
Advanced planning and scheduling (APS)/Advanced Planning Systems (APS) -
Techniques that deal with analysis and planning of logistics and manufacturing during
short, intermediate, and long-term time periods.
Aggregate Forecast - An estimate of sales, often time-phrased, for a grouping of
products or product families produced by a facility or firm. Stated in terms of units,
dollars, or both, the aggregate forecast is used for sales and production planning
purposes
Aggregate Plan - A plan that includes budgeted levels of finished goods, inventory,
production backlogs, and changes in the workforce to support the production strategy.
Aggregated information rather than product information is used
Agility - The ability to quickly plan, source, make, and deliver to adapt and respond to
changes in the competitive environment. It is a SCOR performance attribute that
includes product or service flexibility (speedy introduction of new products and
services), mix flexibility (ability to quickly change products or services offered), volume
flexibility (ability to service large order quantities), and delivery flexibility (ability to
quickly change delivery dates to meet new requirements)
Allocation - The classification of resources or items quantities that have been assigned
to specific orders but have not yet been released from the stockroom to production. It is
an "uncashed" stockroom requisition. 2. A process used to distribute material in short
supply
Alpha Factor/Smoothing Constant - In exponential smoothing, the weighting factor that
is applied to the most recent demand, observation, or error
Alternate Operation - Replacement for a normal step in the manufacturing process
Alternate Routing - A routing that is usually less preferred than the primary routing but
results in an identical item. Alternate routings may be maintained in the computer or off-
line via manual methods, but the computer software must be able to accept alternate
routings for specific jobs
Analysis of Variance (ANOVA) - A statistical analysis system that estimates what
portion of variation in a dependent variable is caused by variation in one or more
independent variables. It also produces a number used to infer whether any or all of the
independent-dependent variable relationships have statistical significance
Andon - A sign board with signal lights used to make workers and management aware
of a quality, quantity, or process problem
, Anticipated Delay Report - A report, normally issued by both manufacturing and
purchasing to the material planning function, regarding jobs or purchase orders that will
not be completed on time. This report explains why the jobs or purchases are delayed
and when they will be completed. This report is an essential ingredient of the closed-
loop MRP system. It is normally a handwritten report
Appraisal Costs - Those costs associated with the formal evaluation and audit of quality
in the firm. Typically costs include inspection, quality audits, testing, calibration, and
checking time
Assignable Cause - A source of variation in a process that can be isolated, especially
when its significantly larger magnitude or different origin readily distinguishes it from
random causes of variation
Attribute Data - Go/no-go information. The control charts based on attribute data include
percent chart, number of affected units chart, count chart, count-per-chart, quality score
chart, and demerit chart
Availability - The percentage of a time that a worker or machine is capable of working.
Availability Formula - = (S-B)/S x 100% where S is the scheduled time and B is the
downtime
Available Capacity - The capability of a system or resource to produce a quantity of
output in a particular time period
Available Time - The number of hours a work center can be used, based on
management decisions regarding shift structure, extra shifts, regular overtime,
observance of weekends and public holidays, shutdowns, and the like
Backflush Costing - The application of costs based on the output of a process. Is usually
associated with repetitive manufacturing environments
Backward Integration - The process of buying or owning elements of the production
cycle and channel of distribution back toward raw material suppliers
Backward Scheduling/Back Scheduling - A technique for calculating operation start
dates and due dates. The schedule is computed starting with the due date for the order
and working backward to determine the required start date and/or due dates for each
operation
Balanced Scorecard - A list of financial and operational measurements used to evaluate
organizational or supply chain performance. The dimensions might include customer
perspective, business process perspective, financial perspective, and innovation and
learning perspectives. Formally connects overall objectives, strategies, and
measurements.
