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AM1
Assignment - A
Question 1. A small electronics company produces pocket calculators and records the
demand monthly. The following demand data are for a representative calculator:
November 45
December 57
January 60
Using 50 as the exponential smoothing forecast for November, and using 0.3 as the
exponential smoothing coefficient, forecast February sales.
Question 2. ACE Computers has the following expected production capacity and demand for
minicomputers:
Question 3. The Vice President of Koza Company has estimated the following demand
requirements for the forthcoming periods.
Plan 1: Maintain a stable workforce that is capable of producing 1800 units per period, and
meet the demand by overtime at a premium of $50 per unit. Idle time costs are equivalent to
$60 per unit. Do not build to inventory.
Plan 2: Produce at a steady of 1600 units per period, and accept a limited number of
backorders during periods when demand exceeds 1600 units. The stockout cost of lost sales is
$100 per unit. Inventory costs per period are $20 per unit.
Plan 3: Produce at a steady rate equal to minimum requirements of 1400 units and subtract
the additional units at a $75 per unit premium.
Plan 4: Vary the workforce level, which is currently capable of producing 1600 units per
period.
The cost of additional workforce per 100 units is $5000, and the cost of layoffs per 100 units
is $7500.
Plan 5: Vary inventory levels, but maintain a stable workforce level by maintaining a
constant production rate equal to the average requirements. The company can accumulate
required inventory before period 1 at no additional cost. The inventory cost per period is $20
per unit.
1. Analyse the above plans. Use graph and tables for presentation of your analysis.
Question 4. Using the data in Table 1 below, compute weekly requirement for the following
schedule:
5. With reference to Problem 4, calculate the capacity requirements for the final assembly
department, ignoring lead times.
The subassembly lead times are included in the assembly lead times.
Assignment - B
Question 1. Given the following BOM, MPS and inventory status, develop MRP tables for all
items (ten tables in total)
Question 2. An item has the following gross requirements and a beginning inventory of 40
units:
Question 3. Clark Company makes three products on three different types of equipment. The
matrix of operating times and job setup times (in decimal hours), demand per month, and
economical lot sizes for manufacturing are given in Table below. The machine utilisation
factor is approximately 90%, and operator efficiency of the shop is believed to be 105%.
How many of each of the machines will be needed if the plant works a 40 hour week?
Case Study
Notes: Read the case study and answer the questions given at the end.
CASE I
In 1990, Jain began to make custom furniture full time in his garage. Jain's work had been
admired by friends and neighbours, who often asked him to make special pieces for them. In
1995, he expanded his operations by leasing a used facility and hiring two additional skilled
workers: a woodworker and a leather specialist. By 1998, Jain formed a company called
Good
Today, Good Wood serves a custom furniture market covering Delhi and surrounding
regions. Jain, the CEO, has a staff of 37 employees. Custom made furniture is the sole
product line, and the company has prided itself on high quality and timely delivery services.
Organisationally, Good Wood has Production, Sales, Purchasing, Shipping, and Design
departments. Production department includes wood framing, wood preparation, wood
finishing, metal finishing, leather, glass, plastics, and cloth fabrics.
This past year, 250 to 300 jobs were processed in the facility on any given day. Although
product quality remains high, on time deliveries have deteriorated. The average job seems to
be four to seven weeks late. Suresh, an employee since 1995, and a special assistant to the
shop manager does the shop loading. His job also includes coordinating the overall shop
efforts with those of the sales and design departments. He recently compiled data on waiting
job orders for a typical day.
Detailed scheduling of orders has always been the responsibility of the three shop foremen.
Joshi is foreman of the wood preparation, framing, and finishing departments. Srivastava is
the foreman for the leather and cloth fabrics departments. Chatterjee is the foreman of the
metal, glass and plastics departments.
Jain is concerned about job lateness. He feels deteriorating customer service might well affect
future sales. He has requested George, whose primary experience has been co-ordinating a
new physical distribution system, to analyse the current situation and recommend changes.
George is uncertain which factors he should consider and how to proceed with the problem.
Discuss
1. What is the main problem and what could be the causes of the problem?
2. Propose a production planning and control system to George which would minimise the
above problems
Assignment - C
1. If the order winner is delivery speed to customer, then the production planning and control
system must focus on:
(a) Cost
(b) Lead time
(c) Quality
(d) Coordination with Marketing
2. A firm uses simple exponential smoothing to forecast demand with α = 0.2. The forecast
for the month of March was 500 units whereas the actual demand turned out to be 460 units.
What is the forecast for the month of April?
(a) 489.6
(b) 492
(c) 480
(d) 490
4. Aggregate output planning generally consists of planning a desired output over a period of:
(a) one week
(b) five years
(c) daily
(d) three months to 1 year
8. MRP takes the output from the master schedule, combines that with information from
inventory records and product structure records and determines:
(a) the volume of production in each period
(b) the schedule of timing and quantities for each item to get the right materials to the right
place at the right time
(c) closing inventory
(d) whether customer demand can be met
10. A classification system has been devised to determine how well an MRP system has been
implemented. Class C company is:
(a) one which has MRP II in full use and the closed loop is working
(b) one in which MRP system is working only in the computing department
(c) one which may have MRP, capacity planning and shop floor controls working
(d) one which uses MRP for inventory ordering but not for scheduling
13. The simulation studies on many of the lot sizing rules show:
(a) good performance of L-4-L rule
(b) good performance of EOQ rule
(c) poor performance of PPB, GR and MCP rules
(d) poor performance of L-4-L and EOQ rules
18. A good strategy to meet short term overload for a month can be:
(a) buy a new equipment
(b) invest in a new project
(c) subcontract work
(d) telling marketing that the job cannot be done
21. An aluminium extruder forecasted the demand for pipe extrusions to be 500 units per
month for each of three months. The actual demands turned out to be 400, 560 and 700. The
forecast error in terms of MAD(Mean Absolute Deviation) is:
(a) -50 units
(b) 125 units
(c) 120 units
(d) 53 units
22. Frigerware has experienced demand for ice coolers at 400 units for April, 500 units for
May and
600 units for June. The forecast of demand for July using a three period model with the most
recent period's demand weighted twice as heavily as each of the previous two period's
demand is:
(a) 425
(b) 525
(c) 625
(d) 400
23. In the regression model for forecasting, the forecast of the period's demand F is expressed
as
F = a + bX, where:
(a) F is the independent variable
(b) X is the dependent variable
(c) X is the independent variable
(d) a is the slope of the line
25. For short term periods of up to one year, fundamental capacity is fixed. However, short
term adjustments of capacity are possible by:
(a) building inventories during slack periods to meet later demand
(b) subcontracting during slack periods
(c) building inventories during peak periods to meet demand in slack periods
(d) wishing that some customers may cancel the order
29. Which sequencing rule will you prefer for minimising average job lateness:
(a) Shortest processing time rule
(b) Longest processing time rule
(c) Earliest Due Date rule
(d) First cum first served rule
30. For scheduling N jobs through two machine centers in series, you will use:
(a) Johnson rule to decide the sequence and then schedule on a Gantt chart
(b) McLaren's Order Moment
(c) Groff's Algorithm
(d) None of the above
31. If a machining center has a machine utilisation of 95% and operator efficiency of 80%,
what is the effective work centre capacity in July assuming 26 working days and 3 shifts
running each day:
(a) 472.24 hours
(b) 472 hours
(c) 158.08 hours
(d) 59.28 hours
33. Job A and B are waiting to be released. Both will go to work center 1. Then A will
continue on to work center 3 while B will go to work center 4. Suppose that A has high
priority on the first work center and center 4 is backlogged and center 4 is idle. Which order
should be released first?
(a) Job A
(b) Job B
(c) Both Job A and Job B together
(d) Toss a coin and if its heads, go for Job A otherwise Job B.
35. In an assembly line the total processing time per, unit is 380 seconds. and the cycle time
for the line is 90 seconds. What is the minimum number of workstations required in the
assembly line?
(a) 4 stations
(b) 4.22 stations
(c) 5 stations
(d) 4.2 stations
38. If the setup cost is Rs 10,000 per setup, annual demand is 100,000 units and holding cost
is Rs. 200 per unit per year the optimal batch quantity in production should be (rounded off):
(a) 3162
(b) 316
(c) 31623
(d) 3000
40. If D is the demand per unit of time, L is the lead time, A is the container capacity and S
the safety stock factor,the number of Kanbans N will be :
(a) DL(1+S)/A
(b) A(1+S)/D
(c) LAS(1+D)/24
(d) (D/A)+L+S