A company manufactures bookcases. In August (a four week month), they have a forecast of 66,800 units of a particular SKU. They start the month with 22,000 units on the shelf. This is the MPS grid for the first two weeks:
April | ||||
22000 | 1 | 2 | 3 | 4 |
Forecast | 16700 | 16700 | 16700 | 16700 |
Customer Orders | 12000 | 14000 | 7000 | 4000 |
Projected on-hand | 10550 | 14850 | ||
MPS | 5250 | 21000 |
Safety stock for this item is 10,000 boxes. Production is in fixed lots of 5,250 boxes
What is the projected on hand in week 4?
Answer: steps for MPS
step 1 | IOH= | PIOH of last week | |
step 2 | Requirement= | D+SS-IOH | CO will be taken instead of D when CO>D |
step 3 | NR= | is equal to requirement (if requirement>0) OR 0 (if requirement is negative) | |
step 4 | MPS= | more than or equal to NR in multiples of lot size | |
step 5 | PIOH= | IOH+MPS-D | CO will be taken instead of D when CO>D |
MPS
safety stock SS= | 10000 | |||
Q = lot size= | 5250 | |||
beginning inventory= | 22000 | |||
Period | 1 | 2 | 3 | 4 |
Demand | 16700 | 16700 | 16700 | 16700 |
Customer orders CO | 12000 | 14000 | 7000 | 4000 |
On-Hand Inventory IOH | 22000 | 10550 | 14850 | 13900 |
Requirement | 4700 | 16150 | 11850 | 12800 |
Net requirements NR | 4700 | 16150 | 11850 | 12800 |
Master production schedule MPS | 5250 | 21000 | 15750 | 15750 |
Projected On-Hand Inventory POHI | 10550 | 14850 | 13900 | 12950 |
Projected On-Hand Inventory in week 4= 12950
A company manufactures bookcases. In August (a four week month), they have a forecast of 66,800...