Exercise 5

The Alpha Beta Company produces two products; A and B, that are made from components C
and D. Given the following product structures, master scheduling requirements, and inventory
information, determine when orders should be released for A, B, C, and D and the size of those
orders

LLC:
item A 0
lotsize: L4L LT: 3 1 2 3 4 5 6 7 8
gross requirement 0 0 0 0 0 0 0 100
schedule receipts                
projected on hand 10 10 10 10 10 10 10 10 0
net requirement               90
planned order
receipts               90
planned order
releases           90      

Answer
 item B LLC: 0 period
lotsize: L4L LT: 2 1 2 3 4 5 6 7 8
gross requirement 0 0 0 0 0 200 0 0
schedule receipts                
projected on hand 5 5 5 5 5 5 0 0 0
net requirement           195    
planned order receipts           195    
planned order releases         195        

LLC:
item C 0 period
lotsize: Min 50 LT: 4 1 4 2 5 3 6 7 8
gross requirement 0 0 0 270 0 0 0 0
schedule receipts                
projected on hand 140 140 140 140 140 0 0 0 0
net requirement         130      
planned order
receipts         130      
planned order
releases   130              

item D LLC: period

0
lotsize: Mul 250 LT: 2 1 2 3 4 5 6 7 8
gross requirement 0 0 0 585 180 0 0 0
schedule receipts   250            
projected on hand 200 200 200 450 115 185 185 185 185
net requirement       135 65      
planned order       250 250      
receipts
planned order     250 250          
releases

Exercise 6
Files and More, Inc. (F&M), a manufacturer of office equipment, uses MRP to schedule its production.
Because of the current recession and the need to cut costs, F&M has targeted inventory as a prime area
for cost reduction. However, the company does not want to reduce its customer service level in the
process. Demand and inventory data for a two-drawer file cabinet are given in the following table.
Complete an MRP matrix for the file cabinet using:
(a) L4L
(b) EOQ
(c) POQ lot sizing.
Which lot-sizing rule do you recommend?

Lead time = 1 period

Holding cost = $1 per cabinet per period
Ordering cost = $100 per order
Beginning inventory = 25

Answer
20+ 40+30+10+ 45
d́= =29
5
a.

L4L
item LLC: 0 period
lot size: L4L LT: 1 1 2 3 4 5
gross requirement 20 40 30 10 45
schedule receipts          
projected on hand 25 5 0 0 0 0
net requirement   35 30 10 45
planned order receipts     35 30 10 45
planned order releases   35 30 10 45  

Total cost = (4x100$)+(5x1$) = 405$

b.
 2 Co d́
EOQ=
√ √Cc
=
2 ×100 × 29
1
=76

EOQ
item LLC: 0 period
lot size: EOQ 77 LT: 1 1 2 3 4 5
gross requirement 20 40 30 10 45
schedule receipts          
projected on hand 25 5 42 12 2 34 X
net requirement   35     43
planned order receipts     77     77
planned order releases   77     77  

Total cost = (2x100$) + (5+42+12+2+33) x 1$ = 295$

c.
Q 77
POQ= = ≈ 3
d́ 29

POQ
item LLC: 0 period
lot size: POQ 3 LT: 1 1 2 3 4 5
gross requirement 20 40 30 10 45
schedule receipts          
projected on hand 25 5 40 10 0 0
net requirement   35     45
planned order receipts     75     45
planned order releases   75     45  

Total cost = (2x100$) + (5+40+10) x1$ = 255$

The POQ should be recommended because the total cost is the lowest