Is this MRP?
No, and deliberately not. Horizon213 has recipes, batches, raw-material consumption and real costing. It does not have production planning, work centres, routings, operation times, machine scheduling, or multi-level recipe explosion. A business that needs those needs a dedicated manufacturing system, and Horizon213 says so rather than half-building one.
Can it trace which raw-material lot went into which finished product?
No. Horizon213 records a lot number and an expiry date on the movement that brought goods in, which answers what arrived, when it expires, and whether there is still stock of it. It does not record which lot a particular movement drew from, so claiming lot-to-lot genealogy would be a claim the data cannot support. A business under a real traceability obligation needs a fuller design.
What happens to units that come out unusable?
They are recorded as waste and reduce the good output, which raises the cost of every good unit. That is what actually happened to the business: the materials were consumed either way. Sending the waste to a loss account instead would understate the cost of what is now on the shelf.
Does every company see the production module?
No. Production stays off until a company asks for it, like the till and the delivery round. A trading business that resells what it buys never meets a recipe screen.