Question

3.15. Given the following data, calculate the projected available balance and the planned MPS receipts. The lot size is 100. The demand time fence is 2 weeks. Week Forecast 50 50 Customer Orders 1 60 30 Projected Available Balance MPS

Answer 1

PAB = Prior period PAB or on-hand balance + MPS – Customer Orders

PAB for period one is the on-hand balance (inventory) is 60 units, and after satisfying the customer orders, the PAB is zero. To satisfy the demand for future products, the MPS is scheduled for lot size 100.

PAB for period 2 = 0 + 100 – 30 = 70

After the demand time fence, the forecast influence the PAB, so the greater value from customer orders and forecast is considered while calculating PAB.

PAB for next periods = Prior PAB + MPS – customer orders or forecast whichever is greater

PAB for period 3 = 70 + 0 – 65 = 5

PAB for Period 4 = 5 + 100 – 50 = 55

Week		1	2	3	4	Total
Forecast		50	50	50	50	200
Customer Orders		60	30	65	25	180
Projected Available Balance	60	0	70	5	55	130
MPS			100		100	200