Question

3. Consider the following Product Structure Data, Demand Data, Routing and Standard data for a company that assembles two products, A and B. Product Structure Data | A B E (2 required) D Ε . (2 required) F (3 required) 3 required) Complete the following tables in order to determine the capacity requirements by using Capacity Bills method. (30 points) Routing and Standard Data End Product Lot Sizes Operation Work Center Standard Setup Hours Standard Production Hours per unit Standard Setup Hours per unit Total Hours per unit 0.25 0.30 300 501 of 1 100 3 B 100 1 of 1 100 3 Components C 40 1 of 2 2002 40 2 of 2 D20 1 of 23001 20 2 of 2 2001 E 501 of 1 2003 F 50 1 of 1 300 3 Demand Data: I Week 1 2 3 4 A 40 30 1535 B 30 30 40 30 0.35 0.45 0.55 0.30 0.25 0.50 Bill of Capacity: А в

Answer 1

SSH - Standard setup hours , SHP - Standard production hours

TH - Total hours

SSH/unit = SSH/(Lot sizes) TH/unit = SPH/unit + SSH/unit

Routing and standard data

End product	Lot Sizes	Operations	Work Center	SSH	SPH/unit	SSH/unit	TH/unit
A	50	1 on 1	100	3	0.25	0.06	0.06
B	100	1 on 1	100	3	0.30	0.03	0.33
Components
C	40	1 on 2	200	2	0.35	0.05	0.40
	40	2 on 2	300	2	0.45	0.05	0.50
D	20	1 on 2	300	1	0.55	0.05	0.60
	20	2 on 2	200	1	0.30	0.05	0.35
E	50	1 on 1	200	3	0.25	0.06	0.31
F	50	1 on 1	300	3	0.50	0.06	0.56

BILL OF CAPACITY

	A	B
Work Center	Total time/unit	Total time/unit
100	0.31	0.33
200	1.02	0.97
300	3.30	3.40
	4.63	3.40

For ex - for work center 200 for A = Total time / unit is calculated as TH/unit(C) * 1 + TH/unit(E) *2 = 0.4 + 0.31*2 = 1.02

for work center 300 for A = Total time / unit is calculated as TH/unit(C) *1 + TH/unit(F) * 5 = 0.5 + 0.56*5 = 3.3

Capacity requirements by using capacity bills

Work Centre	1	2	3	4	TH	PWCP(%)
100	22.3	19.2	17.85	20.75	80.10	6.9%
200	69.9	59.7	54.1	64.8	248.5	21.3%
300	234	202	185.5	217.5	838	71.8%
Total hours					1166.6	100%

PCWP - Projected work center percentage

for work center 100 for week 1 , Capacity Requirement is calculated as Demand (A)* TT/unit(A) + Demand(B) * TT/unit(B)

= 40 * 0.31 + 30 * 0.33 = 22.3

same is calculated for all the cells and percentage is then calculated as (TH (of respective work center ) / Total Hours )*100%