Production and Operations Analysis, Seventh Edition
7th Edition
ISBN: 9781478623069
Author: Steven Nahmias, Tava Lennon Olsen
Publisher: Waveland Press, Inc.
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Chapter 8.2, Problem 10P
Summary Introduction
Interpretation:The MRP calculation for the valves is to be determined.
Concept Introduction:
The optimal order policy is known as economic order quantity (EOQ) which is used to order the different quantities in such way that minimizes the holding cost and ordering cost.
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Students have asked these similar questions
If the the Net Requirement for a product for a particular time period in a MRP problem is 78 and the organization uses a policy of ordering in multiples of 100, what would be the Planned Order Receipt?
The inventory control models discussed in Chapters 4 and 5 are often labeledindependent demand models and MRP is often labeled a dependent demandsystem. What do the terms independent and dependent mean in this context?
For Question 1 you are required to mannualy (without the use of excel) develop two MRP matrices: one with no lot sizing (you order what is required) and a lot seize equal to the EOQ.
To determine the EOQ note that the inventory carrying cost is given as R1/unit/period. This means that you have to calculate the average demand per period and use this demand value in your EOQ calculation. This is then the order quantity to be used for the second MRP matrix.
Chapter 8 Solutions
Production and Operations Analysis, Seventh Edition
Ch. 8.1 - Prob. 1PCh. 8.1 - Prob. 2PCh. 8.1 - Prob. 3PCh. 8.1 - Prob. 4PCh. 8.1 - Prob. 5PCh. 8.1 - Prob. 6PCh. 8.1 - Prob. 7PCh. 8.1 - Prob. 8PCh. 8.1 - Prob. 9PCh. 8.2 - Prob. 10P
Ch. 8.2 - Prob. 11PCh. 8.2 - Prob. 12PCh. 8.2 - Prob. 13PCh. 8.2 - Prob. 14PCh. 8.2 - Prob. 15PCh. 8.2 - Prob. 16PCh. 8.2 - Prob. 17PCh. 8.2 - Prob. 18PCh. 8.2 - Prob. 19PCh. 8.2 - Prob. 20PCh. 8.2 - Prob. 21PCh. 8.2 - Prob. 22PCh. 8.3 - Prob. 23PCh. 8.3 - Prob. 24PCh. 8.3 - Prob. 25PCh. 8.4 - Prob. 26PCh. 8.4 - Prob. 27PCh. 8.4 - Prob. 28PCh. 8.4 - Prob. 29PCh. 8.5 - Prob. 30PCh. 8.5 - Prob. 31PCh. 8.5 - Prob. 32PCh. 8.5 - Prob. 33PCh. 8.5 - Prob. 34PCh. 8.6 - Prob. 35PCh. 8.6 - Prob. 36PCh. 8.6 - Prob. 37PCh. 8.6 - Prob. 38PCh. 8.6 - Prob. 39PCh. 8.6 - Prob. 40PCh. 8 - Prob. 41APCh. 8 - Prob. 42APCh. 8 - Prob. 43APCh. 8 - Prob. 44APCh. 8 - Prob. 45APCh. 8 - Prob. 46APCh. 8 - Prob. 48APCh. 8 - Prob. 49APCh. 8 - Prob. 50APCh. 8 - Prob. 51AP
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Similar questions
- a. Determine the planned order release for the motherboards in the problem given assuming that one uses the EOQ formula to schedule production. Use K = $180 and h = 0.40.b. Using the results from part (a), determine the gross requirements schedule for the DRAM chips, which are ordered from an outside supplier. The order cost is $25.00, and the holding cost is $0.01 per chip per week. What order schedule with the vendor results if the EOQ formula is used to determine the lot size?c. Repeat the calculation of part (b) for the add-in boards. Use the same value of the setup cost and a holding cost of 28 cents per board per week.arrow_forwardA single inventory item is ordered from an outside supplier. The anticipateddemand for this item over the next 12 months is 6, 12, 4, 8, 15, 25, 20, 5, 10, 20, 5,12. Current inventory of this item is 4, and ending inventory should be 8. Assume aholding cost of $1 per period and a setup cost of $40. Determine the order policyfor this item based onc. Part period balancingarrow_forwardThe inventory control models are often labeled independent demand models and MRP is often labeled a dependent demand system. What do the terms independent and dependent mean in this context?arrow_forward
- Anticipated demands for a four-period planning horizon are 23, 86, 40, and 12.The setup cost is $300 and the holding cost is h = $3 per unit per period.a. Enumerate all the exact requirements policies, compute the holding and setupcosts for each, and find the optimal production plan.b. Solve the problem by backward dynamic programmingarrow_forwardComplete the master production schedule based on the following information On-hand Inventory - 160 schedule production whenever projected on-hand inventory drops below - 30 MPS lot size - 300 Week 1 2 3 4 5 6 7 8Forecast 120 100 130 110 140 140 170 180 Customer Orders 110 100 75 50 32 11 5 0Projected On-Hand Inventory 160MPSAvailable-to-Promisearrow_forwardThe time-phased net requirements for the base assembly in a table lamp over the next six weeks are: Week 1 2 3 4 5 6 Requirements 335 240 180 320 320 200 The setup cost for the construction of the base assembly is $200, and the holding cost is $0.30 per assembly per week. What lot sizing do you obtain from the EOQ formula? Determine the lot sizes using the Silver–Meal heuristic. Determine the lot sizes using the least unit cost heuristic. Determine the lot sizes using part period balancing. Determine the lot size using the Wagner–Whitin algorithm. Compare the holding and setup costs obtained over the six periods using the policies found in parts (a) through (e) with the cost of a lot-for-lot policy.arrow_forward
- HP produces its multimedia notebook computer on a production line that has an annual capacity of 10000 units. HP estimates the annual demand for this model at 5000 units. The cost to set up the production line is $2200, and the annul holding cost is $25 per unit. Show steps to find: a. What is the optimal production lot size? b. How many production runs should be made each year? c. What is the total inventory cost?d. What is the cycle time?arrow_forwardIt is Monday morning, and you have just arrived at work. Complete the followingMRP record as it would appear Monday morning. Lead time is 2 weeks, and the lotsize is 100. During the week, the following events occur. Enter them in the MRP record.a. The planned order for 100 in week 1 is released.b. Thirty of the scheduled receipts for week 1 are scrapped.c. An order for 30 is received for delivery in week 3.d. An order for 50 is received for delivery in week 6.e. The gross requirements of 70 in week 1 are issued.arrow_forwardA initially assume that Phi wants to minimize his inventory requirements. Assume that each order will be only for what is required for a single period. Calculate the net requirements and planned order releases for the gear boxes and input shafts. Assume that lot sizing is done using a lot-for-lot (L4L). Gear box requirements Week 1 2 3 4 5 6 7 8 9 10 11 12 Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipt Planned order release Input shaft requirements Week 1 2 3 4 5 6 7 8 9 10 11 12 Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipt Planned order releasearrow_forward
- The fixed quantity version of EOQ compares and contrasts with the fixed interval version. Where will each of the scenarios be used?arrow_forwardThe requirements of local motor bikes for a company are given as [25,5,25,30, 20] for week 1, 2, 3, 4 and 5 respectively. If the setup costs and holding costs assumed at $80 and $1 /unit/week respectively, find the lot sizing using both Silver Meal and LUC Heuristics.arrow_forwardMRP systems are: a. Intended to be used for independent demand items b. Intended to reduce inventory requirements, production lead times, and delivery times to customers c. Intended to determine an appropriate master production schedule d. Appropriate for all end items in the product line e. Substitutes for fixed order point/order quantity systemsarrow_forward
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