Exam 10: Sales and Operations Planning Aggregate Planning

To develop a superior plan,sales and operations planning must consider:

Regular production costs $13 per unit and selling a unit represents a cash inflow of $28 per unit.Assume that all units reflected on the forecast will be sold.What is the cumulative net cash flow through March?

Your book describes three phases in the implementation of sales and operations planning in an organization.What are the three phases and what takes place in each?

Describe how both top-down and bottom-up planning work and the situations where one approach is superior to the other.

A company has a sales forecast for the following five months as shown in the table.If they have a beginning inventory of 225 units,what amount should be produced under a level plan in order for them to have an ending inventory of zero units at the end of the five month period?

A sales and operations plan that varies both production and inventory levels is called a(n)________ production plan.

A production planner can confirm future capacity requirements based on released or planned orders by referring to a(n)________.

The standard equation used by Gigi Enterprises for production planning is Production = Demand.The sales and operations planner is probably using:

Planning numbers are somewhat aggregated (month by month)in what planning level?

Describe the differences between level,chase,and mixed production plans.Use the forecast in the table to show the differences by creating a plan of each type.There is no beginning inventory and regular production capacity is 350 units.Overtime costs $10 extra and is limited to 50 units per month.Subcontracting is limited to 100 units per month and costs $15 per unit.Back orders cost $40 per unit and there is a cost of $5 per month to hold a unit in inventory.There is room for only 100 units in inventory.

The objective function of an optimization modeling approach to S&OP should not allow available labor or equipment time to be exceeded.

It costs $12 to make a single unit using regular production and $15 to make a single unit using overtime production.Total overtime production is limited to 500 units for the five month period.The manufacturing plant has a regular production capacity of 250 units per month and 50 units in inventory at the start of the planning period.There is a $5 per unit charge for holding inventory at the end of each month and a limit of 250 units ending inventory for any period.Develop an objective function and constraints to solve this problem.

Regular production costs $15 per unit and selling a unit represents a cash inflow of $25 per unit.Assume that all units reflected on the forecast will be sold.What is the net cash flow for March?

Bottom-up planning should be used when the product/service mix is unstable and resource requirements vary greatly across the offerings.

Detailed planning and control is riskier than strategic planning.

Compared to other levels of planning,detailed planning and control offers the greatest ability to adjust capacity.

A(n)________ production plan matches production in each time period with the sales forecast.

Willow Trees Inc.makes seven different products,four of which are within their first year of existence.The demands for all products,especially the newest ones,are not well known.The newest products are intended to complement their existing products and take different materials,different processes,and an entirely different set of labor skills for production.Which of these statements regarding their likely sales and operations planning activities is BEST?

Regular production costs $25 per unit and selling a unit represents a cash inflow of $30 per unit.Assume that all units reflected on the forecast will be sold.What is the cumulative net cash flow at the end of April?

It costs $12 to make a single unit using regular production and $15 to make a single unit using overtime production.Total overtime production is limited to 500 units for the five month period.The manufacturing plant has a regular production capacity of 250 units per month and 50 units in inventory at the start of the planning period.There is a $5 per unit charge for holding inventory at the end of each month and a limit of 250 units ending inventory for any period.What is the lowest cost production plan if the forecast must be met?