Answer to Question #204673 in Management for Siyamthanda

Question

N Composing Its MRP Plan, Suppose The Operations Management (OM) Receives An Order For 1 000, 3-Blade Fans. A Fan Is Composed Of 4 Major Components, Namely: •A Fan Motor •A Pedestal •A 4 – Switch Assembly And 2m Electric Cord. •A Safety Fan Guard OM Has The Following Items In Stock: Fully Assemble Fans: 120;, Fan Motors: 90;, 4–Switch Assemblies: 70;, Pedestals: 80;, Safety Fan Guards: 150;, And Electric Cords 240m. Question 3a: Do The Following Gross To Net Calculations: •The Net Requirements For 4-swutch assembles

Answer 1

Solution

Allocatable inventory (t) = released order (t) + available inventory (t - 1)

Allocatable inventory (t) = (70+120) +70

Allocatable inventory (t)=260

Net requirements (t) = allocatable inventory (t) - total requirements (t)

Net requirement (t)=260 – 1000

Net requirement (t)= -740

when the obtained net requirements is a negative number, its absolute figure is used as the net requirements. Therefore, the Net requirements for 4-switch assembly is 740.