Chapter 16

CHAPTER 16
MATERIAL REQUIREMENTS PLANNING
Review and Discussion Questions
1. Discuss the meaning of MRP terms such as planned order release and scheduled order
receipts.
A planned order release is an order currently planned to be released. It has not been released.
Consequently the planned order release can be changed based upon changes in demand as
one e!ample.
A scheduled order receipt on the other hand reflects an order that has already been released.
"he scheduled order receipt indicates the anticipated arri#al of the released order. Due to
#ariations in deli#ery times it may not arri#e e!actly at the planned arri#al time.
$. Many practitioners currently update MRP %ee&ly or bi%ee&ly. 'ould it be more #aluable if
it %ere updated daily( Discuss.
"he performance of any operation %ill naturally #ary from day to day. 'hen the obser#ed
time period in %hich performance is measured is a %ee& or t%o the daily #ariations are
smoothed) that is the #ariations in performance are a#eraged. *or e!ample belo%+a#erage
performance in one day may be offset by a higher+than+a#erage performance the ne!t day.
Daily MRP runs monitor performance too closely and may e#en create an e!ception report
calling a normal #ariation an abnormal de#iation from e!pected output.
,. 'hat is the role of safety stoc& in an MRP system(
"he role of safety stoc& in an MRP system is to buffer any uncertainties in quantities. -ne
cause of quantity uncertainties is quality. .afety lead time should be used to offset any
uncertainties in timing from such occurrences as production or purchase delays. "he
addition of safety stoc& results in e!tra in#entory being carried thus reducing performance.
If possible any uncertainties in the quantities should be eliminated so that no safety stoc& is
needed.
/. 0o% does MRP relate to CIM( 1.ee supplement 23
CIM or Computer+integrated manufacturing replaces the con#entional areas of product and
process design planning and control and manufacturing %ith si! ne% areas4computer+
aided design group technology manufacturing planning and control systems automated
materials handling computer+aided manufacturing and robotics. MRP5s position in the CIM
scheme is primarily in the manufacturing planning and control systems %hich plan and
schedule operations compare alternati#es update data monitor operations and pro6ect
operating results. "his can include 1as in MAPIC.3 order+entry shop floor control
purchasing cost accounting etc. -ther effects on the MRP system occur because of other
parts of CIM for e!ample group technology affects the routing and sequencing for MRP)
aspects of computer+aided manufacturing change MRP such as *M. 1fle!ible manufacturing
systems3 %hich simplify MRP since an *M. cell can do a #ariety of processes.
$78
Chapter 16
9. Contrast the significance of the term lead time in the traditional :-; conte!t and in an MRP
system.
In the traditional conte!t lead time is fi!ed4either as a discrete time or as a probability
distribution. .uch lead time constancy or #ariation is outside of the in#entory model.
<ead time in an MRP system is assumed to be a #ariable. 'hile specific lead times are stated
for planning purposes these times may be speeded up or delayed as conditions %arrant.
Indeed it is this ability to detect needed changes in lead times4either by e!pediting or de+
e!pediting4that many users cite as one of the most #aluable features of MRP.
6. Discuss the importance of the master production schedule in an MRP system.
"he master production schedule =dri#es> the system. It states the planned due dates for end
items. Material requirements planning computer runs ho%e#er in#ol#e an iterati#e process.
"he master production schedule =proposes> or =hypothesi?es> a tentati#e schedule. After the
MRP run %ith this schedule the shop scheduler e!amines the MRP plan for impractical loads
on the producti#e system4either by stating e!cessi#e demands on personnel or equipment
or in e!cessi#e idle time. "hen the master production schedule is re#ised and the program is
run again.
2ecause the entire MRP system is geared to satisfying the master production schedule it is
critical that the master production schedule be correct at the start of the first MRP run. "he
production scheduler then &no%s %hat effects any changes he ma&es on the schedule %ill
ha#e on the original MRP schedule. 0e can then ta&e appropriate action as necessary such as
requesting that customers be contacted to try to e!tend promised dates if they are too close
or to arrange for early deli#ery or additional storage space if products %ill be completed prior
to the promised deli#ery date.
@. =MRP 6ust prepares shopping lists. It does not do the shopping or coo& the dinner.>
Comment.
An MRP system generates schedules to meet material needs. It starts %ith the master
schedule and de#elops a time phased schedule %hich specifies %hat %hen and ho% many
units of each material are required. 'hether this schedule is adhered to depends first on the
master scheduler %ho may change the schedule. "hen an in#entory control personnel may
choose to change order quantities or timing. "hen the purchasing department may ma&e
further modifications to a purchase order and finally the production scheduler may actually
release the %or& to production41%hich may be at some time other than that called for in the
MRP schedule3.
8. 'hat are the sources of demand in an MRP system( Are these dependent or independent
and ho% are they used as inputs to the system(
An MRP system has both dependent and independent item demands. "he ma6or demands on
the system occur through the master production schedule 1these are usually of independent
origin3. *rom here on throughout the system the demands are then dependent on the master
production schedule.
-rders for spare parts and repair parts normally do not go through the master production
schedule unless their amounts are large enough to place a significant load on the producti#e
$7A
Material Requirements Planning
system. "hese demands 1%hich are usually independent3 are fed into the in#entory records
file by+passing the master production schedule. -nce there they are then e!ploded into the
required parts and materials needed during the normal course of the MRP run. "he parts and
materials needed to ma&e the spares and repair parts are therefore dependent demand.
A. .tate the types of data that %ould be carried in the bill of materials file and the in#entory
record file.
"he 2ill of Materials file contains information about the product including a listing of parts
numbers quantities needed per unit or product and the assembly or process flo% stipulating
ho% the unit is structured. :ngineering design changes that affect the product structure are
placed into the 2ill of Materials file. Also parts or material changes that occur through a
change of #endors or material composition are also added to update the file.
"he In#entory Record file contains a great deal of information about each in#entory item. At
a minimum the file %ould contain the number of units on hand and on order the number
reser#ed for prior commitments the cost of the item the name and address of the #endor the
lead time needed to obtain a shipment and any shipment si?e restrictions. Additional
information may be added as desired such as that contained in :!hibit 16.17.
Po!"e#s
Problem "ype of Problem Difficulty Be%
Problem
Modified
Problem
Chec&
figure in
Appendi!
A
MRP
schedule
<ot
si?ing
techniques
Disaggregation 2ill of
materials
1 Ces Ces Moderate
$ Ces :asy
, Ces Moderate
/ Ces Moderate Ces
9 Ces Moderate
6 Ces Ces Moderate
@ Ces Moderate
8 Ces Moderate
A Ces Moderate Ces
17 Ces Moderate
11 Ces Moderate Ces
1$ Ces Moderate
1, Ces Moderate
1/ Ces :asy Ces
19 Ces Moderate
16 Ces Difficult
1@ Ces Ces Moderate
18 Ces Difficult
$17
Chapter 16
MRP schedule %or&sheet
Period
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
Item
<"D
;D
Eross requirements
.cheduled receipts
-n hand from prior period
Bet requirements
Planned order receipts
Planned order releases
$11
Material Requirements Planning
1.
X
A(4) C(3)
F(4) G(2)
B(2)
D(3) E(1)
b.
F A 2 C D : * E
179 /7/ 197 $A9 $@7 +17 187 /A7
$.
Period 1 $ , / 9 6 @ 8 A 17
Item
G
<"D
1
%ee&
;D
</<
Eross requirements
@9 97 @7
.cheduled receipts
-n hand from prior period
/7 /7 7 7 7
Bet requirements
,9 97 @7
Planned order receipts
,9 97 @7
Planned order releases
,9 97 @7
$1$
Chapter 16
,.
Period 1 $ , / 9 6 @ 8 A 17
Item
F
<"D
1
;D
</<
Eross requirements
177
.cheduled receipts
-n hand from prior period
$7 $7 $7 $7 $7 $7 $7 $7 $7 $7
Bet requirements
87
Planned order receipts
87
Planned order releases
87
Item
C
<"D
$
;D
</<
Eross requirements
167
.cheduled receipts
-n hand from prior period
/7 /7 /7 /7 /7 /7 /7 /7 /7
Bet requirements
1$7
Planned order receipts
1$7
Planned order releases
1$7
Item
H
<"D
,
;D
</<
Eross requirements
$/7
.cheduled receipts
-n hand from prior period
,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7
Bet requirements
$17
Planned order receipts
$17
Planned order releases
$17
Item
A
<"D
$
;DD
</<
Eross requirements
/$7 1$7
.cheduled receipts
-n hand from prior period
97 97 97 97 97 97 7
Bet requirements
,@7 1$7
Planned order receipts
,@7 1$7
Planned order releases
,@7 1$7
Item
2
<"D
1
;DD
</<
Eross requirements
$/7
.cheduled receipts
-n hand from prior period
177 177 177 177 177 177 177
Bet requirements
1/7
Planned order receipts
1/7
Planned order releases
1/7
Item
C
<"D
,
;DD
</<
Eross requirements
8/7
.cheduled receipts
-n hand from prior period
A77 A77 A77 A77 A77 A77 67 67 67 67
Bet requirements
Planned order receipts
Planned order releases
$1,
Material Requirements Planning
/.
Z
A(2) B(4)
C(3) D(4)
E(2)
Level
0
1
2
3
Period 1 $ , / 9 6 @ 8 A 17
Item
H
<"D
$
;D
</<
Eross requirements
97
.cheduled receipts
-n hand from prior period
Bet requirements
97
Planned order receipts
97
Planned order releases
97
Item
A
<"D
1
;D
</<
Eross requirements
177
.cheduled receipts
-n hand from prior period
Bet requirements
177
Planned order receipts
177
Planned order releases
177
Item
2
<"D
1
;D
</<
Eross requirements
$77
.cheduled receipts
-n hand from prior period
Bet requirements
$77
Planned order receipts
$77
Planned order releases
$77
Item
C
<"D
1
;D
</<
Eross requirements
,77
.cheduled receipts
-n hand from prior period
Bet requirements
,77
Planned order receipts
,77
Planned order releases
,77
Item
D
<"D
1
;D
</<
Eross requirements
/77
.cheduled receipts
-n hand from prior period
Bet requirements
/77
Planned order receipts
/77
Planned order releases
/77
Item
:
<"D
,
;D
</<
Eross requirements
877
.cheduled receipts
-n hand from prior period
Bet requirements
877
Planned order receipts
877
Planned order releases
877
$1/
Chapter 16
9.
A
B(3)
C
E(2) D
Level
0
1
2
3 D(2)
B
E(2)
F F
E(2) D
F 4
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
$
;D
</<
Eross requirements
,7
.cheduled receipts
17
-n hand from prior period
7 7 17 17 17 17 17 17 7 7
Bet requirements
$7
Planned order receipts
$7
Planned order releases
$7
Item
2
<"D
1
;D
</<
Eross requirements
97 67
.cheduled receipts
-n hand from prior period
7 7
Bet requirements
97 67
Planned order receipts
97 67
Planned order releases
97 67
Item
C
<"D
1
;D
97
Eross requirements
$7
.cheduled receipts
-n hand from prior period
17 17 17 17 17 17 /7 /7 /7 /7
Bet requirements
17
Planned order receipts
97
Planned order releases
97
Item
D
<"D
$
;D
97
Eross requirements
97 67 /7
.cheduled receipts
-n hand from prior period
7 7 /7
Bet requirements
97 67 7
Planned order receipts
97 177
Planned order releases
97 177
Item
:
<"D
1
;D
$77
Eross requirements
177 $$7
.cheduled receipts
97
-n hand from prior period
97 177 177 177 7 187 187 187 187 187
Bet requirements
$$7
Planned order receipts
/77
Planned order releases
/77
Item
*
<"D
1
;D
</<
Eross requirements
/77
.cheduled receipts
97
-n hand from prior period
197 $77 $77 $77
Bet requirements
$77
Planned order receipts
$77
Planned order releases
$77
6. Product structure tree
$19
Material Requirements Planning

A
B(2) C(3)
E F(2)
Level
0
1
2
3
D(2)
F(2)
D(2)
D
<o%+le#el coded product structure tree

A
B(2) C(3)
E F(2)
Level
0
1
2
3 D(2)
F(2)
D(2) D
Indented bill of materials .ingle le#el bill of materials
.A A
.21$3 21$3
.: C1,3
.D1$3 D1$3
.*1$3 2
.C1,3 :
.*1$3 *1$3
.D C
.D1$3 D
*1$3
:
D1$3
$16
Chapter 16
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
1
;D
</<
Eross requirements
$7
.cheduled receipts
-n hand from prior period
Bet requirements
$7
Planned order receipts
$7
Planned order releases
$7
Item
2
<"D
$
;D
</<
Eross requirements
/7
.cheduled receipts
-n hand from prior period
Bet requirements
/7
Planned order receipts
/7
Planned order releases
/7
Item
C
<"D
1
;D
</<
Eross requirements
67
.cheduled receipts
-n hand from prior period
19 19 19 19 19 19 19
Bet requirements
/9
Planned order receipts
/9
Planned order releases
/9
Item
D
<"D
1
;D
</<
Eross requirements
177 /9 /7
.cheduled receipts
-n hand from prior period
97 97 97 7 7 7 7
Bet requirements
97 /9 /7
Planned order receipts
97 /9 /7
Planned order releases
97 /9 /7
Item
:
<"D
$
;D
97
Eross requirements
/7
.cheduled receipts
$7
-n hand from prior period
7 $7 $7 $7 ,7 ,7 ,7 ,7 ,7
Bet requirements
$7
Planned order receipts
97
Planned order releases
97
Item
*
<"D
1
;D
187
Eross requirements
87 A7
.cheduled receipts
-n hand from prior period
Bet requirements
87 177 17 17 17 17
Planned order receipts
187
Planned order releases
187
$1@
Material Requirements Planning
@.
A
B
C(4)
D(2) E E
F(3) F(3) F
C
D(2) E
F(3)
Level
0
1
2
3
4
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
$
;D
</<
Eross requirements
97
.cheduled receipts
17
-n hand from prior period
$7 ,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7
Bet requirements
$7
Planned order receipts
$7
Planned order releases
$7
Item
2
<"D
$
;D
97
Eross requirements
$7
.cheduled receipts
-n hand from prior period
7 ,7 ,7
Bet requirements
$7
Planned order receipts
97
Planned order releases
97
Item
C
<"D
1
;D
177
Eross requirements
$77 $7
.cheduled receipts
177
-n hand from prior period
97 197 197 197 197 197 97 97 ,7 ,7
Bet requirements
97
Planned order receipts
177
Planned order releases
177
Item
D
<"D
,
;D
</<
Eross requirements
$77
.cheduled receipts
177
-n hand from prior period
177 177 $77 $77 $77 7 7 7 7 7
Bet requirements
Planned order receipts
Planned order releases
Item
:
<"D
$
;D
</<
Eross requirements
177 97
.cheduled receipts
-n hand from prior period
17 17 17 17 17 7
Bet requirements
A7 97
Planned order receipts
A7 97
Planned order releases
A7 97
Item
*
<"D
$
;D
97
Eross requirements
$@7 197 97
.cheduled receipts
-n hand from prior period
7 ,7 ,7 ,7 ,7 ,7 ,7 ,7
Bet requirements
$@7 1$7 $7
Planned order receipts
,77 197 97
Planned order releases
,77 197 97
$18
Chapter 16
8.
A
B(2)
C
D(3) F
Level
0
1
2
3 D
B(3)
E E(4)
D(3) F
E E 4
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
$
;D
$7
Eross requirements
$7
.cheduled receipts
17
-n hand from prior period
9 9 9 19 19 19 19 19 19 19
Bet requirements
9
Planned order receipts
$7
Planned order releases
$7
Item
2
<"D
$
;D
/7
Eross requirements
67 /7
.cheduled receipts
$7
-n hand from prior period
17 17 17 17 17 17 17 17 17 17
Bet requirements
,7 ,7
Planned order receipts
/7 /7
Planned order releases
/7 /7
Item
C
<"D
1
;D
</<
Eross requirements
$7
.cheduled receipts
-n hand from prior period
Bet requirements
$7
Planned order receipts
$7
Planned order releases
$7
Item
D
<"D
,
;D
167
Eross requirements
1$7 1$7 $7
.cheduled receipts
-n hand from prior period
177 177 177 177 177 1/7 $7 7 7 7
Bet requirements
$7
Planned order receipts
167
Planned order releases
167
Item
:
<"D
$
;D
</<
Eross requirements
167 87
.cheduled receipts
67
-n hand from prior period
177 177 7 7 7 7 7
Bet requirements
87
Planned order receipts
87
Planned order releases
87
Item
*
<"D
$
;D
</<
Eross requirements
/7 /7
.cheduled receipts
/7
-n hand from prior period
7 7
Bet requirements
/7
Planned order receipts
/7
Planned order releases
/7
A.
$1A
Material Requirements Planning
A
B(2) C(3)
F
Level
0
1
2 D F(2) E
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
1
;D
</<
Eross requirements
$7 $7 67 97
.cheduled receipts
-n hand from prior period
$7 7 7 7 7 7 7 7
Bet requirements
$7 67 97
Planned order receipts
$7 67 97
Planned order releases
$7 67 97
Item
2
<"D
1
;D
</<
Eross requirements
/7 1$7 177
.cheduled receipts
,7
-n hand from prior period
97 /7 /7 /7 /7 7 7
Bet requirements
87 177
Planned order receipts
87 177
Planned order releases
87 177
Item
C
<"D
$
;D
</<
Eross requirements
67 187 197
.cheduled receipts
-n hand from prior period
67 7 7 7 7 7 7
Bet requirements
187 197
Planned order receipts
187 197
Planned order releases
187 197
Item
D
<"D
1
;D
97
Eross requirements
187 197
.cheduled receipts
-n hand from prior period
$9 $9 $9 /9 /9 /9 /9 /9 /9 /9
Bet requirements
199 179
Planned order receipts
$77 197
Planned order releases
$77 197
Item
:
<"D
$
;D
177
Eross requirements
187 197
.cheduled receipts
-n hand from prior period
7 $7 $7 @7 @7 @7 @7 @7
Bet requirements
187 1,7
Planned order receipts
$77 $77
Planned order releases
$77 $77
Item
*
<"D
$
;D
177
Eross requirements
,67 87 ,77 177
.cheduled receipts
-n hand from prior period
7 /7 67 67 67 67 67 67
Bet requirements
,67 /7 $/7 /7
Planned order receipts
/77 177 ,77 177
Planned order releases
/77 177 ,77 177
17.
$$7
Chapter 16
A
B C(2)
D(2)
Level
0
1
2 D E(3)
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
1
;D
</<
Eross requirements
,7 ,7 /7
.cheduled receipts
-n hand from prior period
$7 $7 7 7 7 7 7 7
Bet requirements
17 ,7 /7
Planned order receipts
17 ,7 /7
Planned order releases
17 ,7 /7
Item
2
<"D
1
;D
</<
Eross requirements
17 ,7 /7
.cheduled receipts
17
-n hand from prior period
7 7 7 7 7 7 7
Bet requirements
,7 /7
Planned order receipts
,7 /7
Planned order releases
,7 /7
Item
C
<"D
1
;D
I97
Eross requirements
$7 67 87
.cheduled receipts
97
-n hand from prior period
17 /7 /7 /7 ,7 ,7 ,7
Bet requirements
$7 97
Planned order receipts
97 97
Planned order releases
97 97
Item
D
<"D
$
;D
177
Eross requirements
17 177 ,7 177 /7
.cheduled receipts
-n hand from prior period
$7 17 17 17 87 87 87 /7 /7 /7
Bet requirements
A7 $7 $7
Planned order receipts
177 177 177
Planned order releases
177 177 177
Item
:
<"D
$
;D
97
Eross requirements
197 197
.cheduled receipts
-n hand from prior period
17 17 17 17 17 17 17 17 17 17
Bet requirements
1/7 1/7
Planned order receipts
197 197
Planned order releases
197 197
$$1
Material Requirements Planning
11.
<east "otal Cost
Period 1 $ , / 9 6 @ 8 A 17
Eross Requirements ,7 97 17 $7 @7 87 $7 67 $77 97
-n+hand A7 67 17 7 $,7 167 87 67 7 97
Bet requirements 7 7 7 $7 7 7 7 7 $77 7
Planned order receipts $97 $97
Planned order releases $97 $97
<east Jnit Cost
Period 1 $ , / 9 6 @ 8 A 17
Eross Requirements ,7 97 17 $7 @7 87 $7 67 $77 97
-n+hand A7 67 17 7 /,7 ,67 $87 $67 $77 7
Bet requirements 7 7 7 $7 7 7 7 7 7 97
Planned order receipts /97 97
Planned order releases /97 97
Calculations
'ee&s ;uantity
ordered
Carrying
cost
-rder
cost
"otal cost Jnit cost
/ $7 K7.77 K17.77 K17.77 K7.977
/ to 9 A7 7.@7 17.77 17.@7 7.11A
/ to 6 1@7 $.,7 17.77 1$.,7 7.7@$
/ to @ 1A7 $.A7 17.77 1$.A7 7.768
/ to 8 $97 9.,7 17.77 19.,7 7.761
/ to A /97 19.,7 17.77 $9.,7 7.796
/ to 17 977 18.,7 17.77 $8.,7 7.79@
A $77 7.77 17.77 17.77
A to 17 $97 $.97 17.77 1$.97

*or <east "otal Cost order for periods / through 8 since carrying cost is the closest to ordering
cost. *or <east Jnit Cost order for periods / through A since this has the lo%est unit cost.
$$$
Chapter 16
1$.
Aggregate Plan I II
'-RMs $177 $@77
Master Production .chedule
Period 1 $ , / 9 6
Internal Model $17 $17 $17 $@7 $@7 $@7
:!ternal Model /A7 /A7 /A7 6,7 6,7 6,7
MRP schedule
Period 1month3 +/ +, +$ +1 1 $ , / 9 6
Item
Int.
'orm
<"D
1
;D
</<
Eross requirements
$17 $17 $17 $@7 $@7 $@7
.cheduled receipts
-n hand from prior period
177 7 7 7 7
Bet requirements
117 $17 $17 $@7 $@7 $@7
Planned order receipts
117 $17 $17 $@7 $@7 $@7
Planned order releases
117 $17 $17 $@7 $@7 $@7
Item
Int. :lec.
L
0ousing
<"D
$
;D
</<
Eross requirements
117 $17 $17 $@7 $@7 $@7
.cheduled receipts
-n hand from prior period
97 7 7 7 7 7
Bet requirements
67 $17 $17 $@7 $@7 $@7
Planned order receipts
67 $17 $17 $@7 $@7 $@7
Planned order releases
67 $17 $17 $@7 $@7 $@7
Item
:tt.
'orm
<"D
1
;D
</<
Eross requirements
/A7 /A7 /A7 6,7 6,7 6,7
.cheduled receipts
-n hand from prior period
$77 7 7 7 7 7
Bet requirements
$A7 /A7 /A7 6,7 6,7 6,7
Planned order receipts
$A7 /A7 /A7 6,7 6,7 6,7
Planned order releases
$A7 /A7 /A7 6,7 6,7 6,7
Item
:!t.
:lect. L
0ousing
<"D
$
;D
</<
Eross requirements
$A7 /A7 /A7 6,7 6,7 6,7
.cheduled receipts
-n hand from prior period
1$9 7 7 7 7 7
Bet requirements
169 /A7 /A7 6,7 6,7 6,7
Planned order receipts
169 /A7 /A7 6,7 6,7 6,7
Planned order releases
169 /A7 /A7 6,7 6,7 6,7
Item
Dri#e
Ass5bly
<"D
,
;D
</<
Eross requirements
/77 @77 @77 A77 A77 A77
.cheduled receipts
-n hand from prior period
$97 7 7 7 7 7
Bet requirements
197 @77 @77 A77 A77 A77
Planned order receipts
197 @77 @77 A77 A77 A77
Planned order releases
197 @77 @77 A77 A77 A77
$$,
Material Requirements Planning
1,.
A
B(2)
D(3)
Level
0
1
2
C(4)
E(2) F(2) E(2)
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
1
;D
</<
Eross requirements
177
.cheduled receipts
-n hand from prior period
7
Bet requirements
177
Planned order receipts
177
Planned order releases
177
Item
2
<"D
$
;D
</<
Eross requirements
$77
.cheduled receipts
-n hand from prior period
7
Bet requirements
$77
Planned order receipts
$77
Planned order releases
$77
Item
C
<"D
$
;D
</<
Eross requirements
/77
.cheduled receipts
-n hand from prior period
7
Bet requirements
/77
Planned order receipts
/77
Planned order releases
/77
Item
D
<"D
,
;D
</<
Eross requirements
677
.cheduled receipts
-n hand from prior period
7
Bet requirements
677
Planned order receipts
677
Planned order releases
677
Item
:
<"D
$
;D
</<
Eross requirements
1$77
.cheduled receipts
-n hand from prior period
7
Bet requirements
1$77
Planned order receipts
1$77
Planned order releases
1$77
Item
*
<"D
,
;D
</<
Eross requirements
877
.cheduled receipts
-n hand from prior period
7
Bet requirements
877
Planned order receipts
877
Planned order releases
877
$$/
Chapter 16
1/. a. Product .tructure "ree
A
B(2) C(3)
E(4) F(3)
Level
0
1
2
3
D(3) H(2)
D
E(5) G(2)
b. <o%+le#el Coded Product .tructure "ree
A
B(2) C(3)
E(4)
F(3)
Level
0
1
2
3
D(3) H(2) D
E(5) G(2)
c. Indented Parts <ist
.A
.21$3
.:1/3
.*1,3
.C1,3
.D1,3
.01$3
.:193
.E1$3
.D113
$$9
Material Requirements Planning
d. <e#el 7 177 units of A
<e#el 1 $77 units of 2
,77 units of C
<e#el $ 677 units of *
677 units of 0
1777 units of D 1,!,!177 M 1!1773
<e#el , ,877 units of : 1/!$!177 M 9!$!,!1773
1$77 units of E
19.
Period 1 $ , / 9 6 @ 8 A 17
Eross Requirements $7 17 19 /9 17 ,7 177 $7 /7 197
-n+hand @7 97 /7 $9
Bet requirements $7
Planned order receipts 187
Planned order releases 187
'ee&s ;uantity
ordered
Carrying
cost
-rder
cost
"otal
cost
Jnit cost
/ $7 K7.77 KA.77 KA.77 K7./97
/ to 9 ,7 7.$7 A.77 A.$7 7.,7@
/ to 6 67 1./7 A.77 17./7 7.1@,
/ to @ 167 @./7 A.77 16./7 7.17,
/ to 8 187 A.77 A.77 18.77 7.177
/ to A $$7 1,.77 A.77 $$.77 7.177
/ to 17 ,@7 ,1.77 A.77 /7.77 7.178
<east "otal Cost method indicates that 187 units should be ordered to co#er the needs for periods
/ through 8 since the carrying cost is equal to the order cost 1KA3. <east Jnit Cost it tied at K.177
for ordering for periods / through 8 and / through A. "herefore order either 187 or $$7 units in
period $.
$$6
Chapter 16
16.
Period 1 $ , / 9 6 @ 8
.tandard Model ,77 /77
.ports Model $77 177
Item
RadioN
CD
<"D
$
;D
</<
Eross requirements
,77 $77 977
.cheduled receipts
-n hand from prior period
97 97 97 97 7 7 7 7
Bet requirements
$97 $77 977
Planned order receipts
$97 $77 977
Planned order releases
$97 $77 977
Item
.td.
trim
<"D
$
;D
</<
Eross requirements
,77 /77
.cheduled receipts
-n hand from prior period
Bet requirements
,77 /77
Planned order receipts
,77 /77
Planned order releases
,77 /77
Item
.td.
0ard+
%are
<"D
,
;D
</<
Eross requirements
,77 /77
.cheduled receipts
-n hand from prior period
Bet requirements
,77 /77
Planned order receipts
,77 /77
Planned order releases
,77 /77
Item
.ports
trim
<"D
$
;D
</<
Eross requirements
$77 177
.cheduled receipts
-n hand from prior period
Bet requirements
$77 177
Planned order receipts
$77 177
Planned order releases
$77 177
Item
.ports
0ard+
'are
<"D
,
;D
</<
Eross requirements
$77 177
.cheduled receipts
-n hand from prior period
Bet requirements
$77 177
Planned order receipts
$77 177
Planned order releases
$77 177
$$@
Material Requirements Planning
1@.
</<
Period 1 $ , / 9 6 @ 8 "otal
Eross Requirements 17 ,7 17 97 $7 /7 97 ,7
-n+0and 7 7 7 7 7 7 7 7 7
-rders 17 ,7 17 97 $7 /7 97 ,7
:-; D
97 . 7
177 3 8 N $/7 1 $
D 17A.9/ or 117
Period 1 $ , / 9 6 @ 8 "otal
Eross Requirements 17 ,7 17 97 $7 /7 97 ,7
-n+hand 7 177 @7 67 17 177 67 17 /17
-rders 117 117 117
<east "otal Cost
Period 1 $ , / 9 6 @ 8 "otal
Eross Requirements 17 ,7 17 97 $7 /7 97 ,7
-n+0and 7 A7 67 97 7 1$7 87 ,7 /,7
-rders 177 1/7
Calculations
'ee&s ;uantity
ordered
Carrying
cost
-rder cost "otal cost
1 17 K7 K177 K177
1 to $ /7 19 177 119
1 to , 97 $9 177 1$9
1 to / 177 177 177 197 -rder
9 $7 7 177 177
9 to 6 67 $7 177 1$7
9 to @ 117 @7 177 1@7
9 to 8 1/7 119 177 $$9 -rder
Cost
Comparison
In#entory
Costs
Bumber
of order
-rder
Costs
"otal Costs
</< K7 8 K877 K877
:-; $79 , ,77 979
<"C $19 $ $77 /19
$$8
Chapter 16
18. Bote the correction in the product structure tree.
A
C(1) D(2)
F(2) G(2)
Level
0
1
2
3
E(2)
F(2)
B
I(2) I(2) H(1)
C(2)
F(2) G(2)
I(2) H(1)
Period 1 $ , / 9 6 @ 8 A 17
Item
A
<"D
1
;D
</<
Eross requirements
@77
.cheduled receipts
-n hand from prior period
,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7 ,7
Bet requirements
6@7
Planned order receipts
6@7
Planned order releases
6@7
Item
2
<"D
$
;D
</<
Eross requirements
1$77
.cheduled receipts
-n hand from prior period
97 97 97 97 97 97 97 97 97 97
Bet requirements
1197
Planned order receipts
1197
Planned order releases
1197
Item
C
<"D
1
;D
</<
Eross requirements
$,77 6@7
.cheduled receipts
-n hand from prior period
@9 @9 @9 @9 @9 @9 @9 @9 7
Bet requirements
$$$9 6@7
Planned order receipts
$$$9 6@7
Planned order releases
$$$9 6@7
Item
D
<"D
$
;D
</<
Eross requirements
1,/7
.cheduled receipts
-n hand from prior period
87 87 87 87 87 87 87 87 87
Bet requirements
1$67
Planned order receipts
1$67
Planned order releases
1$67
Item
:
<"D
1
;D
</<
Eross requirements
$,77
.cheduled receipts
-n hand from prior period
177 177 177 177 177 177 177 177
Bet requirements
$$77
Planned order receipts
$$77
Planned order releases
$$77
$$A
Material Requirements Planning
Item
*
<"D
1
;D
</<
Eross requirements
6A@7 1,/7
.cheduled receipts
-n hand from prior period
197 197 197 197 197 197 197 7
Bet requirements
68$7 1,/7
Planned order receipts
68$7 1,/7
Planned order releases
68$7 1,/7
Item
E
<"D
1
;D
</<
Eross requirements
//97 1,/7
.cheduled receipts
-n hand from prior period
/7 /7 /7 /7 /7 /7 /7 7
Bet requirements
//17 1,/7
Planned order receipts
//17 1,/7
Planned order releases
//17 1,/7
Item
0
<"D
$
;D
</<
Eross requirements
//17 1,/7
.cheduled receipts
-n hand from prior period
$77 $77 $77 $77 $77 $77 7
Bet requirements
/$17 1,/7
Planned order receipts
/$17 1,/7
Planned order releases
/$17 1,/7
Item
I
<"D
$
;D
</<
Eross requirements
1,6/7 $687
.cheduled receipts
-n hand from prior period
,77 ,77 ,77 ,77 ,77 ,77 7
Bet requirements
1,,/7 $687
Planned order receipts
1,,/7 $687
Planned order releases
1,,/7 $687
$,7