It Is Time for a Company to Do Its MRP

question 79

Essay

It is time for a company to do its MRP schedule, but they aren't sure which lot sizing approach to use: lot-for-lot (LFL), fixed order quantity (FOQ) using the EOQ approach, or period order quantity (POQ). They have the following information regarding the product they wish to produce:
$$\begin{array} { | l | c | c | c | c | c | c | } \hline \text { Wekk } & 1 & 2 & 3 & 4 & 5 & 6 \\\hline \text { Net Requirements } & 50 & 40 & 60 & 30 & 50 & 30 \\\hline\end{array}$$
Carrying costs = $1 per unit per week
Set?up costs = $125
Annual demand = 2000 units
Work year = 50 weeks
a. What is the production lot size for week 2 using the LFL method?
b. What is the total cost using the LFL approach?
c. What is the fixed order quantity (EOQ) using the EOQ approach?
d. What is the beginning inventory in week 3 using the FOQ approach?
e. What is the total cost using the FOQ method?
f. What is the period order quantity (POQ)?
g. What is the beginning inventory in week 4 using the POQ approach?
h. What is the total cost using the POQ method?

Comprehend logistics functions, including put-away and its significance in inventory management.

Understand the role of transportation management within the broader scope of distribution activities and supply chain management.

Recognize the role of enterprise resource planning (ERP) systems beyond transportation efficiency, including their implications for logistics and supply chain management.

Comprehend the overall objective of supply chain management and its impact on the functionality and performance of related companies.

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Definitions:

Talcott Parsons

An American sociologist known for his contributions to social theory and for his development of a general theoretical framework for the study of society called structural functionalism.

Gender Role Socialization

The process through which individuals are taught and learn the gender roles associated with their sex, typically through family, culture, education, and media.

Instrumental Traits

Characteristics related to competency, task performance, and goal achievement, often considered masculine attributes.

Rationality

The trait of aligning with or adhering to logical or reasoned principles.