Question

In: Operations Management

Q1: What is the Projected Ending Inventory for week 6?

On hand inventory at end of week 5 = 75

Week

6

7

8

9

10

11

12

13

Forecasted demand

200

200

200

300

300

300

250

250

Booked orders

265

210

190

280

260

225

180

120

Projected ending inventory

???

Master production schedule

600

900

750

Available to promise

XXX

Q1: What is the Projected Ending Inventory for week 6?

a. 400 units.

b. 475 units.

c. 335 units.

d. None of these answers are correct.

e. 410 units.

On hand inventory at end of week 5 = 75

Week

6

7

8

9

10

11

12

13

Forecasted demand

200

200

200

300

300

300

250

250

Booked orders

265

210

190

280

260

225

180

120

Projected ending inventory

???

Master production schedule

600

900

750

Available to promise

XXX

Q2: What is the Projected Ending Inventory for week 7?

a. 215 units

b. 0 units.

c. None of these answers is correct.

d. 275 units.

e. 200 units

On hand inventory at end of week 5 = 75

Week

6

7

8

9

10

11

12

13

Forecasted demand

200

200

200

300

300

300

250

250

Booked orders

265

210

190

280

260

225

180

120

Projected ending inventory

Master production schedule

600

900

750

Available to promise

???

XXX

Q3: What is the Available to Promise for week 6?

a. Minus 65 units.

b. None of these answers is correct.

c. 125 units.

d. 0 units.

e. Minus 75 units.

f. 10 units.

g. 200 units.

Solutions

Expert Solution

Projected ending inventory for current week = Master production scheduleIf any) + projected ending inventory for last week - Max(forecasted demand , booked orders)

therefore

Projected ending inventory for week6 = Master production schedule + projected ending inventory for week5 - Max(200 , 265)

= 600 + 75 - 265

= 410 units

Q1 the Projected Ending Inventory for week 6 is e) 410 units

Projected ending inventory for week7= projected ending inventory for week6 - Max(200 , 210)

= 410 - 210

= 200 units

the Projected Ending Inventory for week 7 is e) 200 units

Available to promise = projected ending inventory for last week + MPS - sum of all booked orders till next MPS

therefore available to promise for week6 = On hand inventory for week5 + MPS for week6 - (sum ofbooked order for week6, 7 and 8)

= 75 + 600 - (265 + 210 + 190)

= 10 units

Available to Promise for week 6 is f) 10 units


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