Question

Management Instructions
	Beginning Inventory			1,207
	Safety Stock			200
	Lot Size			600
Master Production Schedule
Period	1	2	3	4	5	6	7	8
Demand	2,400	6,100	6,400	4,900	4,800	4,800	7,000	7,950
Customer Orders	4,105	5,580	6,850	4,850	3,300	2,000	4,000	9,145
Projected On-Hand Inventory (POHI) (at the end of the period)
Master Production Schedule
Available To Promise (1-period look ahead)

Answer 1

Safety stock is 200 so we have to check and keep an eye that each period we must have at least 200 ending inventory

The lot size is 600 so multiple of 600 can only be ordered

Calculation procedure associated with an available row is

Current period available (Projected on-hand inventory)= Previous period available + MPS – (Greater of forecast or orders)

 An ATP value is calculated for each period in which there is an MPS quantity and also for the first period

 To calculate the available to promise only the actual orders and scheduled production are considered

 ATP calculation procedure Fist period ATP = On-hand + any first-period MPS -Sum of (all orders until the next MPS)

Later period ATP = MPS in that period - Sum (all orders in that and subsequent periods until the next MPS)

The excel and the formulas are shown below

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