Chapter 13, Problem 14PA

a

Summary Introduction

Interpretation:

A material requirement plan for next 7 weeks for item B and C.

Concept Introduction:

The lot sizing rule consists of lot-for-lot, Fixed order quantity and Fixed period quantity. Out of all lot sizing rule, lot-for-lot rule results in least inventory because the order is planned and released according to net requirement of that particular week. A fixed order quantity is an inventory system in which a firm orders a fixed lot size i.e. the order quantity remains the same when ordered every time.

b

Summary Introduction

Interpretation:

Any action notice to be generated.

Concept Introduction:

The lot sizing rule consists of lot-for-lot, Fixed order quantity and Fixed period quantity. Out of all lot sizing rule, lot-for-lot rule results in least inventory because the order is planned and released according to net requirement of that particular week. A fixed order quantity is an inventory system in which a firm orders a fixed lot size i.e. the order quantity remains the same when ordered every time.