A Company Is Trying to Implement MRP but Is Having

question 45

Essay

A company is trying to implement MRP but is having trouble determining which order sizing method will minimize costs. Setup cost is $200 and holding cost is $2/period. If each period is 1 week, gross requirements are 270 units per 10 weeks, and there are 6 planned order releases for every 10 weeks, calculate the cost for lot-for-lot compared to EOQ for an entire year. Assume that EOQ and lot-for-lot are computed as though the usage will occur continually throughout the year.

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Definitions:

Abolish Slavery

The act of formally ending the practice of enslaving people, as achieved in the United States through the 13th Amendment in 1865.

Great Britain

An island in the North Atlantic off the northwest coast of continental Europe, comprising England, Scotland, and Wales, and forming the major part of the United Kingdom.

Empire

A group of nations or peoples ruled over by an emperor, empress, or other powerful sovereign or government, often comprising different territories and peoples.

Grant's Abilities

Refers to the military and leadership qualities of Ulysses S. Grant, 18th President of the United States and commanding general during the American Civil War.