Production and Operations Analysis, Seventh Edition
7th Edition
ISBN: 9781478623069
Author: Steven Nahmias, Tava Lennon Olsen
Publisher: Waveland Press, Inc.
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Chapter 8.5, Problem 31P
Summary Introduction
Interpretation:MRP lot-sizing calculations consider safety stock also. Explain why it should or should not be done. Comment on the statement that “A
Concept Introduction:MRP calculates the lot-sizes on the basis of pre-estimated demand, lead time etc. Variations are all around us in the world. Safety stock is a considered ‘insurance’ against normal variations. This is built in all calculations except the EOQ calculations.
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Explain how much safety stock should be carried in a MRP system ?
Should safety stock be necessary for an MRP system with dependent demand? If so, why? If not, why do firms carry it anyway?
Discuss the advantages and disadvantages of including safety stock in MRPlot-sizing calculations. Do you think that a production control manager would bereluctant to build to safety stock if he or she is behind schedule?
Chapter 8 Solutions
Production and Operations Analysis, Seventh Edition
Ch. 8.1 - Prob. 1PCh. 8.1 - Prob. 2PCh. 8.1 - Prob. 3PCh. 8.1 - Prob. 4PCh. 8.1 - Prob. 5PCh. 8.1 - Prob. 6PCh. 8.1 - Prob. 7PCh. 8.1 - Prob. 8PCh. 8.1 - Prob. 9PCh. 8.2 - Prob. 10P
Ch. 8.2 - Prob. 11PCh. 8.2 - Prob. 12PCh. 8.2 - Prob. 13PCh. 8.2 - Prob. 14PCh. 8.2 - Prob. 15PCh. 8.2 - Prob. 16PCh. 8.2 - Prob. 17PCh. 8.2 - Prob. 18PCh. 8.2 - Prob. 19PCh. 8.2 - Prob. 20PCh. 8.2 - Prob. 21PCh. 8.2 - Prob. 22PCh. 8.3 - Prob. 23PCh. 8.3 - Prob. 24PCh. 8.3 - Prob. 25PCh. 8.4 - Prob. 26PCh. 8.4 - Prob. 27PCh. 8.4 - Prob. 28PCh. 8.4 - Prob. 29PCh. 8.5 - Prob. 30PCh. 8.5 - Prob. 31PCh. 8.5 - Prob. 32PCh. 8.5 - Prob. 33PCh. 8.5 - Prob. 34PCh. 8.6 - Prob. 35PCh. 8.6 - Prob. 36PCh. 8.6 - Prob. 37PCh. 8.6 - Prob. 38PCh. 8.6 - Prob. 39PCh. 8.6 - Prob. 40PCh. 8 - Prob. 41APCh. 8 - Prob. 42APCh. 8 - Prob. 43APCh. 8 - Prob. 44APCh. 8 - Prob. 45APCh. 8 - Prob. 46APCh. 8 - Prob. 48APCh. 8 - Prob. 49APCh. 8 - Prob. 50APCh. 8 - Prob. 51AP
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- Completely fill in the MRP matrices for items J, K, and L. Do not complete the matrix for M and be careful to watch lot size restrictions. Item J LLC 0 Lot Size L4L LT 3 1 2 3 4 5 6 7 8 9 Gross Requirements Scheduled Receipts Projected on Hand 100 Net Requirements Planned Order Receipts Planned Order Releases Item K LLC _ Lot Size Mult 200 LT 2 1 2 3 4 5 6 7 8 9 Gross Requirements Scheduled Receipts Projected on Hand 110 Net Requirements Planned…arrow_forwardHow does the production volume affect break-even analysis?arrow_forwardThis question is based on the following information pertaining to material Pogi: Usage 50 – 100 lbs. per day Lead time 8 – 12 days Size of the order 600 lbs. No. of days in a year 340 What is the average stock level? A. 1,250 B. 1,200 C. 1,000 D. 9252. What is the maximum stock level? 2,500 2,000 1,400 1,2003. What is the minimum stock level? 450 800 850 1,000 4. What is the re-order level? 1,200 1,600 1,750 1,800arrow_forward
- 11. Unik hotel has the available capacity of 500 deluxe rooms, and the margin for each room is $100. The Christmas season is coming and the hotel opens booking from customers and must decide on how many orders to commit to at this time. If the hotel has orders that exceed capacity, it must arrange to upgrade the room for guests, which results in a loss of $50 per room. 2. What is the overbooking level should the hotel accept if cancellations are normally distributed, with a mean of 20 per cent of the orders accepted and a coefficient of variation of 0.5? OA) 142 B) 158 O C) 161 OD) 173arrow_forwardExplain the function of a firm which affects the MRP system ?arrow_forwardWhat does MRP stand for?arrow_forward
- Q7. The president of Rose Bowl Enterprises, Desmond Howard, projects the firms aggregate DEMAND requirements over the next 8 months as follows: These are the monthly DEMAND, not production. MONTH JAN FEB MAR APR MAY JUN JULY AUG DEMAND 1,400 1,600 1,800 1,800 2,200 2,200 1,800 1,800 PRODUCTION 1,600 from December INVENTORY 200 from Dec plus 200 His operations manager is considering a new plan, which begins in January with 200 units on hand. Stockout cost of lost sales is $100 per unit. Inventory holding cost is $20 per unit per month. Ignore any idle time costs. The plan is called plan A. Plan A: Vary the workforce level to execute a strategy that produces the quantity demanded in the prior month. The December demand was given as 1,600 units per month. Therefore, the production for JAN will be 1,600. However, only 1,400 are needed. Therefore, the extra 200 produced go into inventory and there is a holding cost for inventory. Also, per the above, you already have 200 units in inventory…arrow_forwardPennington Cabinets is a manufacturer of several different lines of kitchen and bathroom cabinets that are sold through major home improvement retailers. Pennington built material requirement planning as follows: Current Jan Feb Mar 1200 1000 Gross requirements Scheduled receipts 800 Projected available balance Net requirements Planned order receipts 820 Planned order release Compute net requirements in Feb. Your Answer: Answerarrow_forward1. Speedy, Inc. is a company that produces automotive electrical components. AI5I is a common part for all its products. Consider the following grass requirements and inventory data for AISI part: Week 3 6 7 Grass requirements 40 30 30 70 20 Inventory Data: Lead time Beginning inventorry Scheduled receipts Holding cost Setup cost 1 week 40 $2.50/unit/week S150 Based on the L4L. lot-sizing rule, develop a Material Requirements Plan (MRP) for the next 8 weeks for A15I part. Item: A151 Week 5 Lot size: L4L 1 2 4 7 8 Lead time: 1 Gross Requirements Scheduled Receipts On Hand Inventory Net Requirements Planned Order Receipts Planned Order Releases (ii) Based on the FOQ - 57 units lot-sizing rule, develop a Material Requirements Plan (MRP) for the next 8 weeks for A151 part. Item: A151 Lot size: FOQ 57 Lead time: 1 Gross Requirements Scheduled Receipts On Hand Inventory Net Requirements Planned Order Receipts |Planned Order Releases Week 1 2 4 5 7 8arrow_forward
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