ET ZC342

06/02/2010

Second Semester

2009-2010

Close Book

Q.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.
Month

May

Jun

Jul

Aug

Total

Working days

21

19

20

10

70

Forecast demand
Planned
production
Planned
inventory / 100

115

1254

140

150

1659

[6]
Solution:
Opening Inventory = 100 units
End Inventory = 130 units
Total Production = Demand + EI OI
= 1659 + 130 100 = 1689
Month
May
Jun
Jul
Aug

Total

Working days

21

19

20

10

70

Forecast demand

115
(21/70)
X 1689
= 507
(100+
507115) =
492

1254
(19/70)
X 1689
= 458
(492+4
581254)
= - 304

140
(20/701)
X 1689 =
483

150
(10/71)
X 1689
= 241

1659

(-304+
483-140)
= 39

(39+24
1-150)
= 130

Planned
production
Planned
inventory / 100

**********************
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]
Week

Forecast sales
Projected available balance|
300
MPS

200

300

350

200

150

150

3
350

4
200

5
150

6
150

50

50

100

150

Solution :
Week
1
2
Forecast sales
200
300
Projected available balance|
100
0
300
MPS
200
Q.3. Complete the following table. Lead time
and the order
quantity is 40. What action should be taken?
[6]
Week
Gross requirements
Projected available |
30
Net requirements
Planned order receipt
Planned order release

1
10

2
15

1
10

2
15

3
10

20

35

400
200
200
200
for the part is two weeks,

3
10

4
20

Solution :
Week
Gross requirements
Projected available |
30
Net requirements
Planned order receipt
Planned order release

4
20

10 5 = 5
40
40

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]
Orde
r

Due
Date

Lead Time
Remaining
Days

A
B
C

87
95
100

12
26
21

Actual time remaining

(days)

CR

Solution:
Orde
r

Due
Date

A
B
C

87
95
100

Lead Time
Remaining
Days
12
26
21

Actual time
remaining (days)

CR

87-75 = 12
95-75 = 20
100-75 = 25

1.0
0.76
1.19

Critical Ratio = Actual time remaining / Lead Time Remaining Days

Hence
First Priority is B,
Second Priority is A
Third Priority is C
*******************

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

[5]
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.
Electronic data interchange (EDI)

The exchange of EDI documents is typically between two different companies,

referred to as business partners or TRADING partners. 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]
Actual
Month
Forecast
Demand
1
102
2
91
3
95
4
105
5
94
6
100
7
109
8
92
9
101
10
98
11
Solution:
Month
1

Actual
Demand
102

Forecast

2
3
4
5
6
7
8

91
95
105
94
100
109
92

9
10
11

101
98

96
0.2 x
0.2 x
0.2 x
0.2 x
0.2 x
100
0.2 x
0.2 x
0.2 x

95 + 0.8 x 96 = 96
105 + 0.8 x 96 = 98
94 + 0.8 x 100 = 97
100 + 0.8 97 = 98
109 + 0.8 x 98 =
92 + 0.8 x 100 = 98
101 + 0.8 x 98 = 99
98 + 0.8 x 99 = 99