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Chapter 4: Q3DQ (page 579)
Explain the need for the time fences in the master production schedule.
Time fences concern the limitations or limits across different time frames in the planning outlook. It lets the producers maintain MPS items that are ruled with the aid of an extraordinary set of rules.
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Plan production for the next year. The demand forecast is spring, 20,000; summer, 10,000; fall, 15,000; winter, 18,000. At the beginning of spring, you have 70 workers and 1,000 units in inventory. The union contract specifies that you may lay off workers only once a year, at the beginning of summer. Also, you may hire new workers only at the end of summer to begin regular work in the fall. The number of workers laid off at the beginning of summer and the number hired at the end of summer should result in planned production levels for summer and fall that equal the demand forecasts for summer and fall, respectively. If demand exceeds supply, use overtime in spring only, which means that backorders could occur in winter. You are given these costs: hiring, \(100 per new worker; layoff, \)200 per worker laid off; holding, \(20 per unit-quarter; backorder cost, \)8 per unit; straight-time labor, \(10 per hour; over time, \)15 per hour. Productivity is 0.5 units per worker hour, eight hours per day, and 50 days per quarter. Find the total cost.
Develop a production plan and calculate the annual cost for a firm whose demand forecast is fall, 10,000; winter, 8,000; spring, 7,000; summer, 12,000. Inventory at the beginning of fall is 500 units. At the beginning of fall, you currently have 30 workers, but you plan to hire temporary workers at the beginning of summer and lay them off at the end of summer. In addition, you have negotiated with the union an option to use the regular workforce on overtime during winter or spring if overtime is necessary to prevent stock-outs at the end of those quarters. Overtime is not available during the fall. Relevant costs are hiring, \(100 for each temp; layoff, \)200 for each worker laid off; inventory holding, \(5 per unit-quarter; backorder, \)10 per unit; straight time, \(5 per hour; over time, \)8 per hour. Assume that the productivity is 0.5 units per worker hour, with eight hours per day and 60 days per season.
Mark Price, the new productions manager for Speakers and Company, needs to Find out which variable most affects the demand for their line of stereo speakers. He is uncertain whether the unit price of the product or the effects of increased marketing are the main drivers in sales and wants to use regression analysis to figure out which factor drives more demand for its particular market. Pertinent information was collected by an extensive marketing project that lasted over the past 10 years and was reduced to the data that follow:
Year | Sales/unit (Thousands) | Price/unit | Advertising |
1998 | 400 | 280 | 600 |
1999 | 700 | 215 | 835 |
2000 | 900 | 211 | 1100 |
2001 | 1300 | 210 | 1400 |
2002 | 1150 | 215 | 1200 |
2003 | 1200 | 200 | 1300 |
2004 | 900 | 225 | 900 |
2005 | 1100 | 207 | 1100 |
2006 | 980 | 220 | 700 |
2007 | 1234 | 211 | 900 |
2008 | 925 | 227 | 700 |
2009 | 800 | 245 | 690 |
a. Perform a regression analysis based on these data using Excel. Answer the following questions based on your results.
b. Which variable, price or advertising, has a larger effect on sales and how do you know?
c. Predict average yearly speaker sales for Speakers and Company based on the regression results if the price was \(300 per unit and the amount spent on advertising (in thousands) was \)900
Question: In the following MRP planning schedule for Item J, indicate the correct net requirements, planned order receipts, and planned order releases to meet the gross requirements. Lead time is one week.
Week Number
| Item J | 0 | 1 | 2 | 3 | 4 | 5 |
| Gross Requirement | 75 | 50 | 70 | |||
| On-hand | 40 | |||||
| Net Requirement | ||||||
| Planned order receipt | ||||||
| Planned order release |
Dunstreet鈥檚 Department Store would like to develop an inventory ordering policy with a 95 percent probability of not stocking out. To illustrate your recommended procedure, use as an example the ordering policy for white percale sheets. The demand for white percale sheets is 5,000 per year. The store is open 365 days per year. Every two weeks (14 days) inventory is counted and a new order is placed. It takes 10 days for the sheets to be delivered. The standard deviation of demand for the sheets is five per day. There are currently 150 sheets on hand. How many sheets should you order?
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