Question

A manufacturing company wants to verify the output of their newly acquired MRP software by comparing the computer output with their hand-calculated first ROP for each item in their BOM. They are examining output from their daily April 30 MRP.  

LT=lead time   Qd=lot size discipline   SS=safety stock   GR=Gross Requirements   SR=Scheduled Receipts   PBS=Projected Stock Balance   POR=Planned Order Release Master Production Schedule: Date, May 1 2 3 4 5 End-Item 15 10 18 4 9 . Inventory Records File: Item End-Item A-Item B-Item C-Item LT= 1 1 2 1 SS= 12 15 20 30 Qd= LFL 4 6+ 12+ BI= 50 36 45 52 SR= none 20 on May 1 none 12 on May 1

Question 10. What is the correct inventory policy? (A) Item May 1 May 2 May 3 May 4 May 5 End-Item 0 5 4 9 0 A-Item 7 0 0 0 0 B-Item 6 23 0 0 0 C-Item 0 0 12 0 0 (B) Item May 1 May 2 May 3 May 4 May 5 End-Item 0 5 4 9 0 A-Item 0 7 0 0 0 B-Item 23 6 0 0 0 C-Item 0 0 12 0 0 (C) Item May 1 May 2 May 3 May 4 May 5 End-Item 0 5 4 9 0 A-Item 0 7 0 0 0 B-Item 6 23 0 0 0 C-Item 0 0 2 0 0 (D) Item May 1 May 2 May 3 May 4 May 5 End-Item 0 5 4 9 0 A-Item 0 7 0 0 0 B-Item 6 23 0 0 0 C-Item 0 0 12 0 0 (E) none of the above

Answer 1

The product structure tree is following:

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ANSWER:  (D)

(D)	Item	May 1	May 2	May 3	May 4	May 5
	End-Item	0	5	4	9	0
	A-Item	0	7	0	0	0
	B-Item	6	23	0	0	0
	C-Item	0	0	12	0	0