Question

One unit of A is made of two units of B and one unit of C. B is made of three units of D and one unit of F. C is composed of three units of B, one unit of D, and four units of E. D is made of one unit of E. Item C has a lead time of one week; Items A, B, E, and F have two-week lead times; and Item D has a lead time of three weeks. Lot-for-lot (L4L) lot sizing is used for Items C, E, and F; lots of size 20, 40, and 160 are used for Items A, B, and D, respectively. Items A, B, D, and E have on-hand (beginning) inventories of 5, 10, 100, and 100, respectively; all other items have zero beginning inventories. We are scheduled to receive 10 units of A in Week 3, 20 units of B in Week 7, 40 units of F in Week 5, and 60 units of E in Week 2; there are no other scheduled receipts.

If 20 units of A are required in Week 10, use the low-level-coded bill-of-materials (product structure tree) to find the necessary planned order releases for all components. (Leave no cells blank - be certain to enter "0" wherever required.)

	Period	1	2	3	4	5	6	7	8	9	10
Item A OH = 5 LT = 2 SS = 0 Q = 20	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases
Item C OH = 0 LT = 1 SS = 0 Q = L4L	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases
Item B OH = 10 LT = 2 SS = 0 Q = 40	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases
Item D OH = 100 LT = 3 SS = 0 Q = 160	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases
Item F OH = 0 LT = 2 SS = 0 Q = L4L	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases
Item E OH = 100 LT = 2 SS = 0 Q = L4L	Gross requirements
	Scheduled receipts
	Projected available balance
	Net requirements
	Planned order receipts
	Planned order releases

Answer 1

The product structre is as under:

А B(2) C(1) D(3) F(1) B(3) D(1) E(4) E(1)

Item	Lead time (weeks)	Lot size	On hand (beginning)	Scheduled receipts
A	2	20	5	10 units week 3
B	2	40	10	20 units week 7
C	1	L4L	0	0
D	3	160	100	0
E	2	L4L	100	60 units week 2
F	2	L4L	0	40 units week 5

MRP planning schedule:

Period 1 2 3 4 5 6 7 8 9 10 Item A OH = 5 LT = 2 SS = 0 Q = 20 Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 0 0 0 0 0 0 0 0 0 20 0 0 10 0 0 0 0 0 0 0 5 5 15 15 15 15 15 15 15 15 0 0 0 0 0 0 0 0 0 5 0 0 0 0 0 0 0 0 0 0 20 0 0 0 0 0 0 0 0 20 Period 2 3 4 5 6 7 8 9 10 Item C OH = 0 0 0 0 0 0 0 0 20 0 0 LT = 1 SS=0 Q = L4L Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20 0 Olo 0 0 0 0 0 0 0 20 0 0 0 0 0 0 0 20 0 0 0

Period 1 2 3 4 5 6 7 8 9 10 Item B OH = 10 LT = 2 SS = 0 Q = 40 Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 0 0 0 0 0 0 60 40 0 0 0 0 0 0 0 0 20 0 0 0 10 10 10 10 10 10 10 10 10 10 0 0 0 0 0 0 30 30 0 0 0 0 0 0 0 40 40 0 0 40 0 0 0 0 0 0 40 0 0 0 Period 2 3 4 5 6 7 8 9 10 Item D OH = 100 LT = 3 0 0 0 120 120 20 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SS=0 Q = 160 Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 100 100 100 100 140 20 0 0 0 0 0 0 0 0 0 0 0 0 0 20 160 0 0 0 0 0 0 0 0 0 0 160 0 0 0 0 0 0 0 0

Period 1 2 3 4 5 6 7 8 9 10 Item F OH = 0 LT = 2 0 0 0 0 40 40 0 0 0 0 0 0 0 0 0 0 0 0 0 SS=0 Q = L4L Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 40 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 40 0 0 0 0 0 0 0 0 0 40 0 0 0 0 0 0 0 40 0 0 0 0 0 0 1 2 3 4 5 6 7 8 9 10 Period Item E OH = 100 LT = 2 SS = 0 Q = L4L Gross requirements Scheduled receipts Projected available balance Net requirements Planned order receipts Planned order releases 0 160 0 0 0 0 80 0 0 0 0 60 0 0 0 0 0 0 0 0 100 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 80 0 0 0 0 0 0 0 0 80 0 0 0 0 0 0 0 80 0 0 0 0 0

Projected available balance = Previous period closing stock + Scheduled receipts + Planned order receipts – Gross requirements

Planned receipts are the quantity to be delivered when the Project on hand inventory quantity is negative (so that it becomes equal to or more than zero and is based on lot size). Freshly planned.

Planned order release is the order issued based on the lot size and lead time.

Net requirement is the quantity actually short (if any).

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