CPIM Practice Exam

If a bill of material contains one or more independent demand items that are not sold as spare parts, where will the items be found?

1. They will be at the top of the bill.

2. They could appear at any point.

3. All of the lowest items will be independent demand items.

4. The bill should not have any independent demand items.

The correct answer is: They will be at the top of the bill.

The correct answer is that independent demand items will be found at the top of the bill of material (BOM). This is because independent demand items are typically finished goods or end products that are sold directly to customers. In a bill of materials, these items serve as the basis from which all dependent demand items are derived. In a BOM, independent demand items are often positioned at the highest level, signifying that they do not rely on other components or assemblies for their demand. Their demand is driven by customer orders or market needs rather than the production of other items. For instance, if a company manufactures bicycles, the completed bicycle would be listed at the top as an independent demand item, while components like tires or handlebars, which depend on the demand for bicycles, would be listed at lower levels. This understanding emphasizes the structure and hierarchy of a BOM, where independent demands initiate the creation and consumption of dependent demands. Therefore, when analyzing a bill of material, it is pivotal to recognize the placement and role of independent demand items as they provide a clear indication of the product's position in the overall production process.