A sheet metal company has developed the following six-month production schedule in thousands of square (yards): \[\begin{array} { | l | c | c | c | c | c | c | } \hline \text { Week } & 1 & 2 & 3 & 4 & 5 & 6 \\ \hline \text { Metal } & 150 & 100 & 175 & 200 & 160 & 160 \\ \hline \end{array}\] In addition, their monthly labor and machine capacities in hours) available, and the production standards in hours per square yard) are: $\begin{array}{lcc} & \underline{\text {abor}}& \underline{\text { Machine }}\\ \text { Capacity Available } & 16,000 & 20,000 \\ \text { Prnduction Standard } & .10 & .18 \end{array}$ a. What is the percent utilization of the labor capacity in month 4? b. What is the percent utilization of the machine capacity in month 3? c. In how many weeks are the labor requirements over capacity?

a.Labor utilization: Required capacity =

Exam 13: Resource Management

A company that makes inkjet printers is trying to determine a MRP schedule for the print cartridges it needs in its newest model of printer. They have gross requirements of 1000 units in week 2 and 900 units in week 4. The minimum lot size is 500 units and the lead time is 1 week. They currently have 300 units on hand that includes a safety stock of 150 and another 100 units already allocated. They have 500 units scheduled for receipt in week 1. a. What is the number of units available in week 1? b. What is the planned order release in week 3?

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Question 1

Correct Answer:

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a. 550
b. 850
$\begin{array}{|l|r|r|r|r|}\hline\text { Week} & 1&2&3 & {4} \\\hline \text {Gross Requirements }& & 1000 & & 900 \\\hline \text {Schedule Receipts} & 500 & & & \\\hline \text {Projected OH Inv.} & 550 & 550 & 50 & 50 \\\hline\text { Net Requirements }& & 450 & & 850 \\\hline \text {Plan Order Receipts }& & 500 & & 850 \\\hline \text {Plan Order Releases} & 500 & & 850 & \\\hline\end{array}$

A paint company has the following aggregate demand requirements and cost data for the upcoming year by quarter. Quarter Forecast Demand units) 1 1,200 2 1,500 3 1,900 4 Total 5,600 Previous quarter's producton: Bepinging inventory: Backorder costs: 900 units 0units \ 60/ unit Iventory holding cost on ending inventory): Hiring employees: Firing employees: \1 2/unit/quarter \ 30 unit increase \ 70 unit decrease a. Determine the change in workforce costs hiring and firing (employees) if the paint company decides to use a chase demand strategy. b. Determine the inventory holding and backorder costs for the year if the paint company wants to use a level production strategy, ending Quarter 4 with no inventory.

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a. $\begin{array} { c c c c } \text { Quarter } & \text { Demand } & \text { Productun Rate } & \text { Rate Change } \\\hline 1 & 1200 & 1200 & \$ 900000 \\2 & 1500 & 1500 & \$ 9,000.00 \\3 & \text { 1900 } & \text { 1900 } & \$ 12,000.00 \\ 4 & 1000 & \begin{array} { l } \text { 1000 } \\\end{array} &\underline{ \$63,000.00} \\&&\begin{array} { l } \text { Total } \\\end{array} & \$63,000.00 \end{array}$
b. $\begin{array} { c c c c c } \text { Quarter } & \text { Demand } & \text { Production Rate } & \text { Ending Inventary } & \text { Inventary/Backorder Cost } \\1 & 1200 & 1400 & 200 & 2 , 4 0 0 . 0 0 \\2 & 1500 & 1400 & 100 & \$ 1,200.00 \\3 & 1900 & 1400 & 400 ) & \$ 24,000.00 \\4 & 1000 & 1400 & 0 &\underline{ \$ 0}\\&&&\text { Total }&\$27,600.00\end{array}$

Assigning people to tasks, setting priorities for jobs and scheduling equipment fits best with which level of the generic framework for resource planning?

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Question 3

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C

A company currently has no items in inventory. The demand for the next four months is 200, 400, 250 and 350 units. Determine the level production rate if a level strategy is selected with the goal of ending Period 4 with 100 units in inventory.

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Question 4

The primary output of an MRP system is a time-phased report that gives all of the following except

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Question 5

A chase demand aggregate planning strategy may result in substantial overtime, undertime, and rate-change costs.

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Question 6

The purpose of aggregate planning is to

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Question 7

Explain the three levels of resource planning.

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Question 8

Increasing the output rate without changing existing resources is an example of demand management.

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Question 9

Describe the options that managers have for developing aggregate plans to respond to fluctuating demand.

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Question 10

A sheet metal company has developed the following six-month production schedule in thousands of square (yards): Week 1 2 3 4 5 6 Metal 150 100 175 200 160 160 In addition, their monthly labor and machine capacities in hours) available, and the production standards in hours per square yard) are: Capacity Available 16,000 20,000 Prnduction Standard .10 .18 a. What is the percent utilization of the labor capacity in month 4? b. What is the percent utilization of the machine capacity in month 3? c. In how many weeks are the labor requirements over capacity?

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Question 11

A company is interested in developing a quarterly aggregate production plan but they aren't sure if level capacity or matching demand would be better. They have the following information available regarding their production operation: Number of working days per quarter = 65 days Number of hours per day per person = 8 hours Labor standard to produce one unit = 3 hours Demand for four quarters respectively: 40,000, 42,000, 41,000, and 44,000 units a. Using a level capacity plan, how many workers would be needed each quarter? b. For a level capacity plan, what is the beginning inventory in quarter 2? c. Using a level capacity plan, in how many quarters are the machine requirements over capacity? d. Using a matching demand plan, how many workers are needed for quarter 1? e. How many additional workers are needed in quarter 2 under a matching demand plan?

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Question 12

A company currently has no items in inventory. The demand for the next four months is 200, 400, 250 and 350 units. Assuming a level production rate of 250 units per month, determine the month in which a backorder will materialize.

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Question 13

The words "product family," "budget allocation" and "long-term" fit best with which level of the generic framework for resource planning?

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Question 14

Which of the following is not correct regarding aggregate planning?

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Question 15

The lower the skill requirements of the workforce, the more feasible it is to change workforce levels as an aggregate planning option.

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Question 16

Differentiate between a level production strategy and a chase demand strategy.

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Question 17

Lot sizing is the process of using dependent demand logic to calculate the quantity and timing of orders for all subassemblies and components that support the production of end items.

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Question 18

The Eugene plant of Basic Computers Inc. BCI) wants to develop a net requirements schedule for one model of microcomputers. The beginning inventory is 500 units and they like to carry 50 units as safety stock. The estimated demand for the next 6 weeks is 200, 250, 300, 375, 400, and 600 units. a. What would the net requirements be for week 3? b. What is the beginning inventory in week 5?

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Question 19

Lot sizing rules on a parent item do not affect the gross requirements of all lower level component items.

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Question 20

Assigning people to tasks, setting priorities for jobs and scheduling equipment fits best with which level of the generic framework for resource planning?

A company currently has no items in inventory. The demand for the next four months is 200, 400, 250 and 350 units. Determine the level production rate if a level strategy is selected with the goal of ending Period 4 with 100 units in inventory.

The primary output of an MRP system is a time-phased report that gives all of the following except

A chase demand aggregate planning strategy may result in substantial overtime, undertime, and rate-change costs.

The purpose of aggregate planning is to

Explain the three levels of resource planning.

Increasing the output rate without changing existing resources is an example of demand management.

Describe the options that managers have for developing aggregate plans to respond to fluctuating demand.

A company currently has no items in inventory. The demand for the next four months is 200, 400, 250 and 350 units. Assuming a level production rate of 250 units per month, determine the month in which a backorder will materialize.

The words "product family," "budget allocation" and "long-term" fit best with which level of the generic framework for resource planning?

Which of the following is not correct regarding aggregate planning?

The lower the skill requirements of the workforce, the more feasible it is to change workforce levels as an aggregate planning option.

Differentiate between a level production strategy and a chase demand strategy.

Lot sizing is the process of using dependent demand logic to calculate the quantity and timing of orders for all subassemblies and components that support the production of end items.

Lot sizing rules on a parent item do not affect the gross requirements of all lower level component items.

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