ET ZC342 Second Semester 2009-2010 Close Book 06/02/2010Q.1. A company wants to develop a level production plan for a family of products. The

opening inventory is 100 units, and an increase to 130 units is expected by the end

of the plan. The demand for each month is given in the following table. Calculate

the total production, daily production, and production and ending inventory for

each month.

MonthMayJunJulAugTotal

Working days2119201070

Forecast demand11512541401501659

Planned production

Planned inventory / 100

[6]

Solution:

Opening Inventory = 100 units

End Inventory = 130 units

Total Production = Demand + EI OI

= 1659 + 130 100 = 1689

MonthMayJunJulAugTotal

Working days2119201070

Forecast demand11512541401501659

Planned production(21/70) X 1689 = 507(19/70) X 1689 = 458(20/701) X 1689 = 483(10/71) X 1689 = 241

Planned inventory / 100(100+ 507-115) = 492(492+458-1254) = - 304(-304+ 483-140) = 39(39+241-150) = 130

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Q.2. The shades sunglasses company assembles sunglasses from frames, which it

makes, lenses, which it purchases from an outside supplier. The sales department has prepared the following six-week forecast for Ebony, a popular model. The sunglasses are assembled in lots of 200, and the opening inventory is 300 pairs.

Complete the projected available balance and the master production schedule.

[6]

Week123456

Forecast sales200300350200150150

Projected available balance| 300

MPS

Solution :

Week123456

Forecast sales200300350200150150

Projected available balance| 30010005050100150

MPS200400200200200

Q.3. Complete the following table. Lead time for the part is two weeks, and the order

quantity is 40. What action should be taken? [6]Week1234

Gross requirements10151020

Projected available | 30

Net requirements

Planned order receipt

Planned order release

Solution :Week1234

Gross requirements10151020

Projected available | 3020535

Net requirements10 5 = 5

Planned order receipt40

Planned order release40

An Order for 40 should be released in Week 1.

**************************Q.4. A firm wishes to determine the efficiency and utilization of a work center composed of three machines each working 16 hours per day for five days a week. A study undertaken by materials management department found that over the past year the work center was available for work 12,000 hours, work was actually being done for 10,000 hours, and work was performed 11,480 standard hours. Calculate the utilization, efficiency, and demonstrated weekly capacity. Assume a 50 week year. [6]Solution:Utilization = (Actual Worked Hours / Available Time) X 100 = (10000/12000)X100 = 83.33%

Efficiency = (Standard Time / Actual Time)X100 = (11480 / 12000)X100 = 95.66%demonstrated weekly capacity = (11480/ 50weeks) = 229.6 Hrs / week

******************Q.5. Calculate the critical ratios for the following orders and establish in what order

they should be run. Todays date is 75.

[6]

OrderDue DateLead Time Remaining DaysActual time remaining (days)CR

A8712

B9526

C10021

Solution:OrderDue DateLead Time Remaining DaysActual time remaining (days)CR

A871287-75 = 121.0

B952695-75 = 200.76

C10021100-75 = 251.19

Critical Ratio = Actual time remaining / Lead Time Remaining Days

Hence

First Priority is B, Second Priority is AThird Priority is C

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Q.6. What is EDI? Explain its significance giving an example. [5]

Electronic data interchange (EDI) enables customers and suppliers to electronically exchange transaction information such as purchase orders, invoices, and material requirements planning information. This eliminates time-consuming paperwork and facilitates easy communication between planner/buyers and suppliers.The exchange of EDI documents is typically between two different companies, referred to as business partners orTRADINGpartners. For example, Company A may buy goods from Company B. Company A sends orders to Company B. Company A and Company B are business partners. Q.7. Using exponential smoothing, calculate the forecast for eleventh month. Use _ =

0.2.

[5]MonthActual DemandForecast

1102

291

395

4105

594

6100

7109

892

9101

1098

11

Solution:

MonthActual DemandForecast

1102

291

39596

41050.2 x 95 + 0.8 x 96 = 96

5940.2 x 105 + 0.8 x 96 = 98

61000.2 x 94 + 0.8 x 100 = 97

71090.2 x 100 + 0.8 97 = 98

8920.2 x 109 + 0.8 x 98 = 100

91010.2 x 92 + 0.8 x 100 = 98

10980.2 x 101 + 0.8 x 98 = 99

110.2 x 98 + 0.8 x 99 = 99