Exam L4M7 Topic 2 Question 14 Discussion

Actual exam question for CIPS's L4M7 exam
Question #: 14
Topic #: 2
What is the different between gross material requirements plan (gross MRP) and a net material requirements plan (net MRP)?

Suggested Answer: B Vote an answer

Material requirement planning (MRP) is a production planning and material (inventory) control system used in manufacturing. Objectives of MRP are to ensure materials are available for production while minimising inventory and to plan production and procurement activities.
MRP software combines the master production schedule, the bill of materials and the inventory information to work out the net requirements (net MRP) of what to purchase or produce and when.
These net requirements are worked out using the following equation:
Net requirements = Total requirements - Available inventory
Where:
Total requirement = Gross requirements (gross MRP)
Available inventory = Inventory on hand + Units on order
In the other words, Gross MRP = Net MRP + Available inventory, so the answer should be "The gross MRP includes consideration of available inventory, whereas the net MRP does not" LO 2, AC 2.3

by geraldine44001 at Nov 07, 2025, 05:27 AM

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geraldine44001
2025-11-07 05:27:25
Selected Answer: C
he difference between a gross material requirements plan (gross MRP) and a net material requirements plan (net MRP) is that the net MRP includes the amount of inventory on hand, whereas the gross MRP does not.​

Explanation
Gross MRP shows the total material needed for production, ignoring any existing inventory or scheduled receipts.​

Net MRP calculates actual material requirements by subtracting on-hand inventory and scheduled incoming stock from the gross requirements.​

This means only the net MRP reflects what actually needs to be ordered, since it considers what is already available.​
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