Chapter 12, Problem 11P

Determine material requirements plans for pans N and V and subassembly I as described in Solved Problem 3 for each of the following:

a. Assume that there are currently 100 Ns on hand and scheduled receipts of 40 Is and 10 Vs at the beginning of week 3. No Es are on hand: 120 Es are needed at the start of week 5.

b. Assume on-hand and scheduled receipts as in part a. Now suppose that 100 Es are needed at the stmt of week 5 and 55 at the start of week 7. Also, use multiples of these order sizes: N, 800; V, 200. Use lot-for-lot ordering for I.

C. Using your answer to part b, update the MRP for V, using the following additional information for each of these cases: (1) one week has elapsed (making it the start of week 2), and (2) three weeks have elapsed (making it the start of week 4).

The updated master schedule now has an order for 100 units of E in week 9. Your plan should cover weeks 2 through 9 for case 1, and weeks 4 through 11 for case 2. Assume all orders are released and received as planned.

Summary Introduction

To prepare A Material requirement plan for the given information.

Introduction: Materials Requirement Planning (MRP) is the planning or scheduling system, which is used in the manufacturing process. It is used to plan the number of items required to produce one unit of finished goods (end item).

Explanation of Solution

Given information:

On-hand balances are 100 units of Component N and 0 units of Component E. Scheduled receipts is 40 units of Component I and 10 units of Component C would arrive at the beginning of Week 3. 120 units of Component E are needed at the beginning of Week 5.

Product structure tree:

Prepare master schedule:

Week	1	2	3	4	5	6	7	8
Quantity					120

Develop a material requirement planning for End item E:

• It is given that Person X has received an order to deliver 120 units of End item E, which must be shipped at the start of week 5.
• Beginning inventory is given as 0 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 120 units (120-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 120 units in the beginning of week 5. Hence, they need to order for 120 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 4.

Develop a material requirement planning for Component I (2):

• End item E is the parent item of Component I (2). Hence, the planned order release of E is the gross requirement for Component I (2). As number of units required is 2 for Component I, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component I.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 40 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 200 units on week 4 (240-40).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 200 units in the beginning of week 4. Hence, they need to order for 200 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 5 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 5}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(40+200-240\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component N (4):

• Component I (2) is the parent item of Component N (4). Hence, the planned order release of Component I (2) is the gross requirement for Component N (4). As number of units required is 4 for Component N, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component N.
• Beginning inventory is given as 100 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 700 units on week 3 (800-100).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 700 units in the beginning of week 3. Hence, they need to order for 700 units (as the lot size is lot-for-lot) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(100-700+800\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component V:

• Component I (2) is the parent item of Component V. Hence, the planned order release of Component I (2) is the gross requirement for Component V. As number of units required is 1 for Component V, the planned order release row should be multiplied with 1 to attain the gross requirement column of Component V.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 10 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 190 units on week 3 (200-10).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 700 units in the beginning of week 3. Hence, they need to order for 700 units (as the lot size is lot-for-lot) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(10+190-200\right)+0\\ =0\end{array}$

Summary Introduction

To prepare A Material requirement plan for the given information.

Introduction: Materials Requirement Planning (MRP) is the planning or scheduling system, which can be used in the manufacturing process. It is used to plan the number of items required to produce one unit of finished goods (end item).

Explanation of Solution

Given information:

On-hand balances are 100 units of Component N and 0 units of Component E. Scheduled receipts is 40 units of Component I and 10 units of Component C would arrive at the beginning of week 3. 100 units of Component E are needed at the beginning of week 5 and 55 units needed at the beginning of week 7. Lot size is multiple of 800 for Component N, multiples of 200 for Component V, and lot-for-lot for Component E and Component I.

Product structure tree:

Develop a material requirement planning for End item E:

• It is given that Person X has received an order to deliver 100 units of End item E in the start of week 5 and 55 units of End item E in the start of week 7.
• Beginning inventory is given as 0 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 100 units in week 5 (100-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 100 units in the beginning of Week 5. Hence, they need to order for 100 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 4.

Develop a material requirement planning for Component I (2):

• End item E is the parent item of Component I (2). Hence, the planned order release of E is the gross requirement for Component I (2). As number of units required is 2 for Component I, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component I.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 40 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 160 units on week 4 (200-40).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 160 units in the beginning of week 4. Hence, they need to order for 160 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 5 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 5}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(40+160-200\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component N (4):

• Component I (2) is the parent item of Component N (4). Hence, the planned order release of Component I (2) is the gross requirement for Component N (4). As number of units required is 4 for Component N, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component N.
• Beginning inventory is given as 100 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 540 units on week 3 (640-100).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 540 units in the beginning of week 3. Hence, they need to order for 800 units (as the lot size is multiples of 800) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 260 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(100+800-640\right)+0\\ =260\end{array}$

• Projected on hand inventory for week 6 is 620 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(260+800-440\right)+0\\ =620\end{array}$

Develop a material requirement planning for Component V:

• Component I (2) is the parent item of Component V. Hence, the planned order release of Component I (2) is the gross requirement for Component V. As number of units required is 1 for Component V, the planned order release row should be multiplied with 1 to attain the gross requirement column of Component V.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 10 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 150 units on week 3 (160-10).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 150 units in the beginning of week 3. Hence, they need to order for 200 units (as the lot size is multiples of 200) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 50 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(10+200-160\right)+0\\ =50\end{array}$

• Projected on hand inventory for week 6 is 140 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(50+200-110\right)+0\\ =140\end{array}$

Summary Introduction

To prepare: Material requirement plan for the given information.

Introduction: Materials Requirement Planning (MRP) is the planning or scheduling system, which can be used in the manufacturing process. It is used to plan the number of items required to produce one unit of finished goods (end item).

Explanation of Solution

Given information:

On-hand balances are 100 units of Component N and 0 units of Component E. Scheduled receipts is 800 units of Component N and 200 units of Component V would arrive at the beginning of week 3. Lot size is multiple of 800 for Component N, multiples of 200 for Component V, and lot-for-lot for Component E and Component I.

Week 1 has elapsed. Hence, plan has to be prepared from week 2 through week 9. 100 units of Component E are needed at the beginning of week 5 and 55 units needed at the beginning of week 7. In addition to that, 100 units of End item E are needed in week 9.

Product structure tree:

Develop a material requirement planning for End item E:

• It is given that Person X has received an order to deliver 100 units of End item E in week 5, 55 units in week 7, and 100 units in week 9.
• Beginning inventory is given as 0 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 100 units (100-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 100 units in the beginning of week 5. Hence, they need to order for 100 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 4.

Develop a material requirement planning for Component I (2):

• End item E is the parent item of Component I (2). Hence, the planned order release of E is the gross requirement for Component I (2). As number of units required is 2 for Component I, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component I.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 40 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 160 units on week 4 (200-40).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 160 units in the beginning of week 4. Hence, they need to order for 160 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 5 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 5}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(40+160-200\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component N (4):

• Component I (2) is the parent item of Component N (4). Hence, the planned order release of Component I (2) is the gross requirement for Component N (4). As number of units required is 4 for Component N, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component N.
• Beginning inventory is given as 100 units.
• Scheduled receipt is 800 units at the beginning of week 3
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 180 units on week 5 (440-260).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 180 units in the beginning of week 5. Hence, they need to order for 800 units (as the lot size is multiples of 800) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 4 is 260 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(900+0-640\right)+0\\ =260\end{array}$

• Projected on hand inventory for week 6 is 620 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(260+800-440\right)+0\\ =620\end{array}$

Develop a material requirement planning for Component V:

• Component I (2) is the parent item of Component V. Hence, the planned order release of Component I (2) is the gross requirement for Component V. As number of units required is 1 for Component V, the planned order release row should be multiplied with 1 to attain the gross requirement column of Component V.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 210 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 60 units on week 5 (110-50).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 700 units in the beginning of week 3. Hence, they need to order for 700 units (as the lot size is lot-for-lot) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 50 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(210+0-160\right)+0\\ =50\end{array}$

• Projected on hand inventory for week 6 is 140 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(50+200-110\right)+0\\ =140\end{array}$

Summary Introduction

To prepare: Material requirement plan for the given information.

Introduction: Materials Requirement Planning (MRP) is the planning or scheduling system, which can be used in the manufacturing process. It is used to plan the number of items required to produce one unit of finished goods (end item).

Explanation of Solution

Given information:

On-hand balances are 100 units of Component N and 0 units of Component E. Scheduled receipts is 800 units of Component N and 200 units of Component V would arrive at the beginning of week 3. Lot size is multiple of 800 for Component N, multiples of 200 for Component V, and lot-for-lot for Component E and Component I.

Week 1 has elapsed. Hence, plan has to be prepared from week 2 through week 9. 100 units of Component E are needed at the beginning of week 5 and 55 units needed at the beginning of week 7. In addition to that, 100 units of End item E are needed in week 9.

Product structure tree:

Develop a material requirement planning for End item E:

• It is given that Person X has received an order to deliver 100 units of End item E in week 5, 55 units in week 7, and 100 units in week 9.
• Beginning inventory is given as 0 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 100 units (100-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 100 units in the beginning of week 5. Hence, they need to order for 100 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 4.

Develop a material requirement planning for Component I (2):

• End item E is the parent item of Component I (2). Hence, the planned order release of E is the gross requirement for Component I (2). As number of units required is 2 for Component I, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component I.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 40 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 160 units on week 4 (200-40).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 160 units in the beginning of week 4. Hence, they need to order for 160 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 5 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 5}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(40+160-200\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component N (4):

• Component I (2) is the parent item of Component N (4). Hence, the planned order release of Component I (2) is the gross requirement for Component N (4). As number of units required is 4 for Component N, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component N.
• Beginning inventory is given as 100 units.
• Scheduled receipt is 800 units at the beginning of week 3
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 180 units on week 5 (440-260).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 180 units in the beginning of week 5. Hence, they need to order for 800 units (as the lot size is multiples of 800) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 3.
• Projected on hand inventory for week 4 is 260 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(900+0-640\right)+0\\ =260\end{array}$

• Projected on hand inventory for week 6 is 620 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(260+800-440\right)+0\\ =620\end{array}$

Develop a material requirement planning for Component V:

• Component I (2) is the parent item of Component V. Hence, the planned order release of Component I (2) is the gross requirement for Component V. As number of units required is 1 for Component V, the planned order release row should be multiplied with 1 to attain the gross requirement column of Component V.
• Beginning inventory is given as 0 units.
• Scheduled receipt is 210 units at the beginning of week 3.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 60 units on week 5 (110-50).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 700 units in the beginning of week 3. Hence, they need to order for 700 units (as the lot size is lot-for-lot) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 1.
• Projected on hand inventory for week 4 is 50 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(210+0-160\right)+0\\ =50\end{array}$

• Projected on hand inventory for week 6 is 140 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(50+200-110\right)+0\\ =140\end{array}$

Summary Introduction

To prepare: Material requirement plan for the given information.

Introduction: Materials Requirement Planning (MRP) is the planning or scheduling system, which can be used in the manufacturing process. It is used to plan the number of items required to produce one unit of finished goods (end item).

Explanation of Solution

Given information:

On-hand balances are 100 units of Component N and 0 units of Component E. Lot size is multiple of 800 for Component N, multiples of 200 for Component V, and lot-for-lot for Component E and Component I.

Two weeks (week 2 and week 3) has elapsed. Hence, plan has to be prepared from week 4 through week 11. 100 units of Component E are needed at the beginning of week 5 and 55 units needed at the beginning of week 7. In addition to that, 100 units of End item E are needed in week 9.

Planned order releases from 2^nd and 3^rd week should be used as scheduled receipt units. Scheduled receipt are 160 units of Component I at the start of 4^th week, 800 units of Component N at the start of 5^th week, and 200 units of Component V at the start of 5^th week.

Product structure tree:

Develop a material requirement planning for End item E:

• It is given that Person X has received an order to deliver 100 units of End item E in week 5, 55 units in week 7, and 100 units in week 9.
• Beginning inventory is given as 0 units.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 100 units at week 5 (100-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 100 units in the beginning of week 5. Hence, they need to order for 100 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 4.

Develop a material requirement planning for Component I (2):

• End item E is the parent item of Component I (2). Hence, the planned order release of E is the gross requirement for Component I (2). As number of units required is 2 for Component I, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component I.
• Beginning inventory is given as 40 units.
• Scheduled receipt is 160 units at the beginning of week 4.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 100 units on week 6 (110-0).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 1 week. Company requires 110 units in the beginning of week 6. Hence, they need to order for 110 units (as the lot size is lot-for-lot) on previous week (as the lead-time is 1 week). Thus, company need to order the required units in week 5.
• Projected on hand inventory for week 5 is 0 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 5}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(200+0-200\right)+0\\ =0\end{array}$

Develop a material requirement planning for Component N (4):

• Component I (2) is the parent item of Component N (4). Hence, the planned order release of Component I (2) is the gross requirement for Component N (4). As number of units required is 4 for Component N, the planned order release row should be multiplied with 2 to attain the gross requirement column of Component N.
• Beginning inventory is given as 260 units.
• Scheduled receipt is 800 units at the beginning of week 3
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 180 units on week 7 (800-620).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 180 units in the beginning of week 7. Hence, they need to order for 800 units (as the lot size is multiples of 800) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 5.
• Projected on hand inventory for week 5 is 1,060 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 4}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(260+0-0\right)+800\\ =1,060\end{array}$

• Projected on hand inventory for week 6 is 620 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(1,060+0-440\right)+0\\ =620\end{array}$

Develop a material requirement planning for Component V:

• Component I (2) is the parent item of Component V. Hence, the planned order release of Component I (2) is the gross requirement for Component V. As number of units required is 1 for Component V, the planned order release row should be multiplied with 1 to attain the gross requirement column of Component V.
• Beginning inventory is given as 50 units.
• Scheduled receipt is 200 units at the beginning of week 5.
• Net requirement can be calculated by subtracting the projected on-hand from the gross requirement. Hence, the net requirement is 60 units on week 7 (200-140).
• Planned order release is the order given by the company and planned order receipts is the order received by the firm.
• Lead-time is given as 2 weeks. The company requires 60 units in the beginning of week 7. Hence, they need to order for 200 units (as the lot size is multiples of 200) two weeks before (as the lead-time is 2 weeks). Thus, company need to order the required units in week 5.
• Projected on hand inventory for week 6 is 140 units. Calculation is as follows:

$\begin{array}{c}\text{Projected on hand for Week 6}=\left\{\begin{array}{l}\left(\begin{array}{l}\text{Projected on-hand}+\text{Planned order receipt}\\ -\text{Gross requirement}\end{array}\right)+\\ \text{Scheduled receipt}\end{array}\right\}\\ =\left(250+0-110\right)+0\\ =140\end{array}$