Practice Problems: Chapter 14, Material Requirements Planning (MRP)

Class Problems: Chapter 14, Material Requirements Planning

Problem 1:

The Hunicut and Hallock Corporation makes two versions of the same basic file cabinet, the TOL (Top-of-the-line) five drawer file cabinet and the HQ (High-quality) five drawer filing cabinet.

The TOL and HQ use one unit each of the same cabinet frame and locking mechanism (A). The drawer assemblies are different (5 units of B for each TOL and 5 units of F for each HQ). Both drawer assemblies B and F use one unit of the same drawer frame assembly (C) for each drawer assembly. Further, the drawer assembly B for the TOL cabinet uses one sliding assembly (D) that requires eight bearings (E), and the drawer assembly F for the HQ cabinet uses one sliding assembly (G) and each G requires only four of the same bearings (E).

Develop a material structure tree for the TOL and the HQ file cabinets.

Problem 2: Determine the overall lead time for the two end products TOL and HQ.

Item / Lead time
TOL / 1
HQ / 1
A / 2
B / 1
C / 3
D / 2
E / 2
F / 1
G / 1

Problem 3: Suppose that the production of 100 TOL and 300 HQ file cabinets is planned. Further suppose that the following inventories are available. Determine the low-level code and calculate the net requirements for all the component items.

Item / Available
A / 200
B / 300
C / 120
D / 300
E / 1500
F / 150
G / 1000
Item / Gross requirement / Available / Net requirement

Problem 4: Develop a net material requirements plan for the TOL and HQ file cabinets.

Item / Scheduled Receipts / Available / Lead time
A / Week #1 = 200 / 200 / 2
B / None / 250 / 1
C / Week #1 =600, Week #2 = 600 / 800 / 3
D / Week #1 = 200 / 100 / 1
E / Week #1 = 3000, Week #2 =3000 / 3000 / 2
F / Week #1 =800 / 150 / 2
G / Week #1 = 500 / 0 / 1
Master production schedule
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
MPS for TOL / 50 / 40 / 40 / 60 / 60 / 80
MPS for HQ / 100 / 200 / 200 / 200 / 300
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases
Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement
Scheduled receipts
Projected on-hand
Net Requirement
Planned receipts
Planned order releases

Problem 5: For item B, the setup cost is $250 per setup and the inventory carrying cost is $0.90 per unit per week. Determine the lot sizes and total cost for this item under (i) Lot-for-Lot, (ii) EOQ, and (iii) POQ methods. Let lead time be 1 week.

(i) Lot-for-lot

Item / LT =
Week: / 1 / 2 / 3 / 4 / 5 / 6 / 7 / 8
Gross requirement / 250 / 200 / 200 / 250 / 300 / 300 / 0 / 400
Scheduled receipts / 150 / 0 / 0 / 0 / 0 / 0 / 0 / 0
Projected on-hand / 100
Net Requirement
Planned receipts
Planned order releases

(ii) EOQ

(iii) POQ