1. APP Exercise (Prob.

10)
Develop an APP for the following product line

Production time

1 hour/unit

Beginning
inventory

500 units

Average labour
cost

$10 per hour

Safety
stock

One-half month

Workweek

5 days, 8 hours
each day

Shortage
cost

$20 per unit per

month

Days
per month
Assume
20 is
The
forecast
for the
next year
Jan

Feb

workdays per
Mar month
Apr May Jun

250
0

300
0

400
0

350
0

350
0

300
0

Carrying
cost
Jul
Aug

Sep

Oct

Nov

Dec

400
0

400
0

400
0

300
0

300
0

400
0

$5 per unit per month

The firm wants to have a constant work force and level production,
absorbing variations in demand through inventory excess and
shortages

MRP Exercise-1 (prob. 11)

Assume that Product Z is made of two units
of A and four units of B. A is made up of
three units if C and four of D. D is made of
2 units of E.
Lead time for purchase or fabrication of
each unit to final assembly are: Z takes two
weeks; A,B,C and D take one each week
each and E takes three weeks
Fifty units are required in Period 10
Develop the MRP plan

Requirements of Z
Period:
Ite
m:
O
H:
LT:
SS
:
Q:

Gross
requireme
Z nts
Scheduled
0 receipts
Projected
available
2 balance
Net
requireme
0 nts
Planned
L4 order
L receipts
Planned
order
releases

10

50
0

0
50
50

50

Requirement of A
Period:
Ite
m:
OH:
LT:
SS:
Q:

Gross
A requirements
Scheduled
0 receipts
Projected
available
1 balance
Net
0 requirements
Planned order
L4L receipts
Planned order
releases

10

100

0
100
100

100

Requirement of A
Period:
Ite
m:
OH:
LT:
SS:
Q:

Gross
A requirements
Scheduled
0 receipts
Projected
available
1 balance
Net
0 requirements
Planned order
L4L receipts
Planned order
releases

10

100

0
100
100

100

Requirement of B
Period:
Ite
m:
OH:
LT:
SS:
Q:

Gross
B requirements
Scheduled
0 receipts
Projected
available
1 balance
Net
0 requirements
Planned order
L4L receipts
Planned order
releases

10

200

0
200
200

200

Requirement of B
Period:
Ite
m:
OH:
LT:
SS:
Q:

Gross
B requirements
Scheduled
0 receipts
Projected
available
1 balance
Net
0 requirements
Planned order
L4L receipts
Planned order
releases

10

200

0
200
200

200

Period:
Ite
m:
OH:
LT:
SS:
Q:

Ite
m:
OH:
LT:
SS:
Q:

Ite
m:
OH:
LT:
SS:

C
0
1
0
L4L

D
0
1
0
L4L

E
0
3
0

Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements
Planned order
receipts
Planned order
releases
Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements
Planned order
receipts
Planned order
releases
Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements

10

300

0
300
300

300
400

0
400
400

400
800

0
800

Period:
Ite
m:
OH:
LT:
SS:
Q:

Ite
m:
OH:
LT:
SS:
Q:

Ite
m:
OH:
LT:
SS:

C
0
1
0
L4L

D
0
1
0
L4L

E
0
3
0

Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements
Planned order
receipts
Planned order
releases
Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements
Planned order
receipts
Planned order
releases
Gross
requirements
Scheduled
receipts
Projected
available balance
Net requirements

10

300

0
300
300

300
400

0
400
400

400
800

0
800

MRP Exercise-2 (prob. 15)

One unit of A is made of two units of B and one
unit C. B is made of three units of D, and one unit
of F. C is composed of three units of B, one unit of
D, and four units of E.D is made of one unit of E
Lead times:
C- 1 week
A,B,E and F-2 weeks
D- 3 weeks

Lot sizing is lot-for lot for C,E and F

Lots of size 20, 40 and 160 are used for items A,B,
and D respectively