MINI-ASSIGNMENT 5

Mini-Assignment 5

Mini-Assignment 5

Task 1

After applying the Material Resource Planning (MRP) techniques (Slack et al., pp. 422-428) below findings are obtained which are discussed in later assignment.

Material Requirement Planning Prod.

Week

1-6

7-9

10-12

13-15

16-18

19-22

23-25

26-28

29-31

32-34

35

Total

Demand

0

50

100

150

200

250

200

150

100

50

0

1250

Available

50

50

0

50

50

0

50

0

0

50

0

300

Net requirement

0

0

100

100

150

250

150

150

100

0

0

1000

Minimum order quantity

150

150

150

150

150

150

150

150

150

150

150

150

Order Quantity

0

0

150

150

150

300

150

150

150

0

0

1200

Cost per unit

£ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00 £ 110.00

Total Cost

£ - £ - £ 16,500.00 £ 16,500.00 £ 16,500.00 £ 33,000.00 £ 16,500.00 £ 16,500.00 £ 16,500.00 £ - £ - £ 132,000.00

After preparing MRP for product it is found that there is no requirement of unit during week 1-6 and there is already 50 units in hand of product and minimum order quantity for the product is 150 units. Projected demand during week 7-9 is 50 units which will be fulfilled with 50 units in hand. During week 10-12 projected demand will be 100 units but minimum order quantity is 150 units, therefore minimum order quantity will be ordered which exceeds the requirement of the given period. By applying the same technique it is found that total 1200 units will be ordered with total amount of £ 132,000 (Olson & Kesharwani, 2009, pp. 44-50).

Material Requirement Planning Part A

Week

1-6

7-9

10-12

13-15

16-18

19-22

23-25

26-28

29-31

32-34

35

Total

Demand

0

100

200

300

400

500

400

300

200

100

0

2500

Available

100

100

0

50

0

100

100

200

150

200

100

1100

Net requirement

0

0

200

250

400

400

300

100

50

0

0

1700

Minimum order quantity

250

250

250

250

250

250

250

250

250

250

250

250

Order Quantity

0

0

250

250

500

500

500

250

250

0

0

2500

Cost per unit

£ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 28.00 £ 110.00

Total Cost

£ - £ - £ 7,000.00 £ 7,000.00 £ 14,000.00 £ 14,000.00 £ 14,000.00 £ 7,000.00 £ 7,000.00 £ - £ - £ 70,000.00

After preparing MRP for part A it is found that there is no requirement of unit during week 1-6 and there is not unit of part A in hand (it is notable that 100 units was present as a component of product) and minimum order quantity for the part A is 250 units. Projected demand during week 7-9 is 100 units which will be fulfilled with 100 units in hand. During week 10-12 projected demand will be 200 units but minimum order quantity is 250 units, therefore minimum order quantity will be ordered which exceeds the requirement of the given period. By applying the same technique it is found that total 1700 units will be ordered with total amount of £ 70,000 (Mahadevan, 2010, pp. 348-350).

Material Requirement Planning Part B

Week

1-6

7-9

10-12

13-15

16-18

19-22

23-25

26-28

29-31

32-34

35

Total

Demand

0

150

300

450

600

750

600

450

300

150

0

3750

Available

750

750

600

300

250

50

100

300

250

350

200

3900

Net requirement

0

0

0

150

350

700

500

150

50

0

0

1900

Minimum order quantity

400

400

400

400

400

400

400

400

400

400

400

Order Quantity

0

0

0

400

400

800

800

400

400

0

0

3200

Cost per unit

£ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50 £ 1.50

Total Cost

£ - £ - £ - £ 600.00 £ 600.00 £ 1,200.00 £ 1,200.00 £ 600.00 £ 600.00 £ - £ - £ 4,800.00

After preparing MRP for part B it is found that there is no requirement of unit during week 1-6 and there are 750 units of part B in hand (including 150 units present as a component of product) and minimum order quantity for the part B is 400 ...