5 Material Requirements Planning

Material Requirements Planning (MRP)
Resource
Planning for
Manufacturing
Material Requirements Planning
Materials requirements planning (MRP) is a means
for determining the number of parts, components,
and materials needed to produce a product
MRP provides time scheduling information
specifying when each of the materials, parts, and
components should be ordered or produced
Dependent demand drives MRP
MRP is a software system
Material Requirements
Planning (MRP)
Computerized inventory control and production planning system
When to use MRP?
◦ Dependent demand items
◦ Discrete demand items
◦ Complex products
◦ Job shop production
◦ Assemble-to-order environments
Demand Characteristics
Independent demand Dependent demand
100 x 1 =
100 tabletops
100 tables 100 x 4 = 400 table legs
Continuous demand
400 – Discrete demand
400 –
300 –
No. of tables
300 –
No. of tables
200 –
200 –
100 –
100 –
1 2 3 4 5
Week M T W Th F M T W Th F
Material Master
production
Requirements schedule
Planning
Product Material Item
structure requirements master
file planning file
Planned
order
releases
Work Purchase Rescheduling

orders orders notices
Material Requirements Planning System
Based on a master production schedule, a material

requirements planning system:
◦ Creates schedules identifying the specific parts and
materials required to produce end items
◦ Determines exact unit numbers needed
◦ Determines the dates when orders for those

materials should be released, based on lead times
8
Aggregate Forecasts
Firm orders
product of demand
from known
plan from random
customers
customers
Engineering Master production

Schedule (MPS) Inventory
design
transactions
changes
Material
planning
Bill of (MRP Inventory
material computer record file
file program)
Secondary reports
Primary reports
Exception reports
Planned order schedule for Planning reports
inventory and production Reports for performance
control control
©The McGraw-Hill Companies, Inc., 2004
Master Production Schedule
Drives MRP process with a schedule of finished
products
Quantities represent production not demand
Quantities may consist of a combination of
customer orders and demand forecasts
Quantities represent what needs to be produced,
not what can be produced
Quantities represent end items that may or may
not be finished products
Master Production Schedule (MPS)
Time-phased plan specifying how many and when the firm plans to build
each end item
Aggregate Plan
(Product Groups)
MPS
(Specific End Items)
Example of MRP Logic and Product Structure Tree
Given the product structure tree for “A” and the lead time
and demand information below, provide a materials
requirements plan that defines the number of units of
each component and when they will be needed
Product Structure Tree for Assembly A Lead Times
A 1 day
A B 2 days
C 1 day
D 3 days
B(4) C(2) E 4 days
F 1 day
Total Unit Demand
Day 10 50 A
D(2) E(1) D(3) F(2) Day 8 20 B (Spares)
Day 6 15 D (Spares)
First, the number of units of “A” are scheduled
backwards to allow for their lead time. So, in the
materials requirement plan below, we have to place an
order for 50 units of “A” on the 9th day to receive them
on day 10.
Day: 1 2 3 4 5 6 7 8 9 10
A Required 50
Order Placement 50
LT = 1 day
Next, we need to start scheduling the components that make up
“A”. In the case of component “B” we need 4 B’s for each A. Since
we need 50 A’s, that means 200 B’s. And again, we back the
schedule up for the necessary 2 days of lead time.
Day: 1 2 3 4 5 6 7 8 9 10
A R e q u ire d 50
O rd e r P la c e m e n t 50
B R e q u ire d 20 200
O rd e r P la c e m e n t 20 200
LT = 2
Spares
A 4x50
=200
B(4) C(2)
D(2) E(1) D(3) F(2)

14
Finally, repeating the process for all components, we have the final
materials requirements plan:
Day: 1 2 3 4 5 6 7 8 9 10
A Required 50
LT=1 Order Placement 50
B Required 20 200
LT=2 Order Placement 20 200
C Required 100
D Required 55 400 300
LT=3 Order Placement 55 400 300
E Required 20 200
LT=4 Order Placement 20 200
F Required 200
A
Part D: Day 6
B(4) C(2) 40 + 15 spares
D(2) E(1) D(3) F(2)

Types of Time Fences
Time fence is a management-specified date within which no changes
in the master schedule are allowed.
Frozen
◦ No schedule changes allowed within this window
Moderately Firm
◦ Specific changes allowed within product groups as long as parts are
available
Flexible
◦ Significant variation allowed as long as overall capacity
requirements remain at the same levels
Example of Time Fences
Moderately
Frozen Firm Flexible
Capacity
Forecast and available
capacity
Firm Customer Orders
8 15 26
Weeks
MRP Inputs and Outputs
Inputs
◦ Master production schedule
◦ Product structure file
◦ Item master file
Outputs
◦ Planned order releases
◦ Work orders
◦ Purchase orders
◦ Rescheduling notices
Bill of Materials (BOM) File
A Complete Product Description
Materials
Parts
Components
Production sequence
Modular BOM
◦ Subassemblies
Super BOM
◦ Fractional options
Inventory Records File
Each inventory item carried as a separate file
◦ Status according to specific time periods, “time
buckets”
Pegging
◦ Identify each parent item that created demand.
This allows us to retrace a material requirement
upward in the product structure through each level,
identifying each parent item that created the
demand.
Intended BOM List
LEVEL ITEM QUANTITY

0---- Clipboard 1
-1--- Clip Assembly 1
--2-- Top Clip 1
--2-- Bottom Clip 1
--2-- Pivot 1
--2-- Spring 1
-1--- Rivet 2
-1--- Press Board 1
Specialized BOMs
Phantom bills
◦ Transient subassemblies
◦ Never stocked
◦ Immediately consumed in next stage
K-bills
◦ Group small, loose parts under pseudo-item number
◦ Reduces paperwork
Specialized BOMs (cont.)
Modular bills
◦ Product assembled from major subassemblies and
customer options
◦ Modular bill kept for each major subassembly
◦ Simplifies forecasting and planning
◦ X10 automobile example
◦ 3 x 8 x 3 x 8 x 4 = 2,304 configurations
◦ 3 + 8 + 3 + 8 + 4 = 26 modular bills
Time-phased bills
◦ an assembly chart shown against a time scale
Modular BOMs
X10
Automobile
Engines Exterior color Interior Interior color Body

(1 of 3) (1 of 8) (1 of 3) (1 of 8) (1 of 4)
4-Cylinder (.40) Bright red (.10) Leather (.20) Grey (.10) Sports coupe (.20)
6-Cylinder (.50) White linen (.10) Tweed (.40) Light blue (.10) Two-door (.20)
8-Cylinder (.10) Sulphur yellow (.10) Plush (.40) Rose (.10) Four-door (.30)
Neon orange (.10) Off-white (.20) Station wagon (.30)
Metallic blue (.10) Cool green (.10)
Emerald green (.10) Black (.20)
Jet black (.20) Brown (.10)
Champagne (.20) B/W checked (.10)
Time-phased Bills
Forward scheduling: start at today‘s date and schedule forward to determine

the earliest date the job can be finished. If each item takes one period to
complete, the clipboards can be finished in three periods
Backward scheduling: start at the due date and schedule backwards to
determine when to begin work. If an order for clipboards is due by period three,
we should start production now
Primary MRP Reports
Planned orders to be released at a future time
Order release notices to execute the planned orders
Changes in due dates of open orders due to
rescheduling
Cancellations or suspensions of open orders due to
cancellation or suspension of orders on the master
production schedule
Inventory status data
Secondary MRP Reports
Planning reports, for example, forecasting
inventory requirements over a period of time
Performance reports used to determine
agreement between actual and programmed
usage and costs
Exception reports used to point out serious
discrepancies, such as late or overdue orders
Additional MRP Scheduling Terminology
Gross Requirements
Scheduled receipts
Projected available balance
Net requirements
Planned order receipt
Planned order release

MRP Example
Item On-Hand Lead Time (Weeks)
X 50 2
X A 75 3
B 25 1
C 10 2
A(2) B(1) D 20 2
C(3) C(2) D(5)
Requirements include 95 units (80 firm orders and 15 forecast) of X

on day 10
Day: 1 2 3 4 5 6 7 8 9 10
X Gross requirements 95
X LT=2 Scheduled receipts
Proj. avail. balance 50 50 50 50 50 50 50 50 50 50
On- Net requirements 45
hand Planned order receipt 45
50 Planner order release 45
A Gross requirements 90
A(2) LT=3 Scheduled receipts
Proj. avail. balance 75 75 75 75 75 75 75 75
B Gross requirements 45
It takes LT=1 Scheduled receipts
2 A’s for On-
hand
Net requirements
20
20
each X 25 Planner order release 20
C Gross requirements 45 40
LT=2 Scheduled receipts
Proj. avail. balance 10 10 10 10 10
On- Net requirements 35 40
hand Planned order receipt 35 40
10 Planner order release 35 40
D Gross requirements 100
Proj. avail. balance 20 20 20 20 20 20 20
Day: 1 2 3 4 5 6 7 8 9 10
A(2) B(1) LT=3 Scheduled receipts
B Gross requirements 45
It takes Proj. avail. balance 25 25 25 25 25 25 25 25
1 B for hand Planned order receipt 20
each X C Gross requirements 45 40
Proj. avail. balance 10 10 10 10 10
On- Net requirements 35 40
hand Planned order receipt 35 40
10 Planner order release 35 40
Day: 1 2 3 4 5 6 7 8 9 10
C(3) C(2) B Gross requirements 45
It takes 2 C
LT=2
Gross requirements
Scheduled receipts
45 40
C’s for On-

Proj. avail. balance
Net requirements
10 10 10 10 10
35 40
each B hand
10
Planner order release 35
35
40
40

Day: 1 2 3 4 5 6 7 8 9 10
C(3) C(2) D(5) B Gross requirements 45
It takes 5 C
LT=2
Gross requirements
Scheduled receipts
45 40
D’s for each On-

Net requirements
10 10 10 10 10
35 40
B hand
10
35
40
40

Day: 1 2 3 4 5 6 7 8 9 10
C(3) B Gross requirements 45
It takes 3 C
LT=2
Gross requirements
Scheduled receipts
45 40
C’s for On-

Net requirements
10 10 10 10 10
35 40
each A hand
10
35
40
40

MRP Processes
1. Exploding the bill of material

2. Netting out inventory
3. Lot sizing
4. Time-phasing requirements
MRP Matrix
Product Structure
Clipboard
Top clip (1) Bottom clip (1)
Pivot (1) Spring (1)
Rivets (2)
Finished clipboard Pressboard (1)
Item Master File
DESCRIPTION INVENTORY POLICY
Item Pressboard Lead time 1

Item no. 734 Annual demand 5000
Item type Purch Holding cost 1
Product/sales class Comp Ordering/setup cost 50
Value class B Safety stock 0
Buyer/planner RSR Reorder point 39
Vendor/drawing 07142 EOQ 316
Phantom code N Minimum order qty 100
Unit price/cost 1.25 Maximum order qty 500
Pegging Y Multiple order qty
LLC 1 Policy code 3
Item Master File (cont.)
PHYSICAL INVENTORY USAGE/SALES
On hand 100 YTD usage/sales 1100
Location W142 MTD usage/sales 75
On order 100 YTD receipts 1200
Allocated 75 MTD receipts 0
Cycle 3 Last receipt 8/25
Last count 9/5 Last issue 10/5
Difference -2
CODES
Cost acct. 00754
Routing 00326
Engr 07142
Product Structure Tree
Clipboard Level 0
Pressboard Clip Ass’y Rivets

(1) (1) (2) Level 1
Top Clip Bottom Clip Pivot Spring

(1) (1) (1) (1) Level 2
(Example)
PERIOD
MPS ITEM 1 2 3 4 5
Clipboard 85 95 120 100 100
Lapdesk 0 50 0 50 0
Lapboard 75 120 47 20 17
Pencil Case 125 125 125 125 125
MRP: Example

1 2 3 4 5
Clipboard 85 95 120 100 100

Lapdesk 0 60 0 60 0
Item Master File

CLIPBOARD LAPDESK PRESSBOARD
On hand 25 20 150
On order 175 (Period 1) 0 0
(sch receipt)
LLC 0 0 1
Lot size L4L Mult 50 Min 100
Lead time 1 1 1
MRP: Example (cont.)
Product Structure Record
Clipboard Level 0
Pressboard Clip Ass’y Rivets

(1) (1) (2) Level 1
Lapdesk Level 0
Pressboard Trim Beanbag Glue

(2) (3’) (1) (4 oz) Level 1
ITEM: CLIPBOARD LLC: 0 PERIOD

LOT SIZE: L4L LT: 1 1 2 3 4 5
Gross Requirements 85 95 120 100 100

Scheduled Receipts 175
Projected on Hand 25
Net Requirements
Planned Order Receipts
Planned Order Releases
LOT SIZE: L4L LT: 1 1 2 3 4 5

Projected on Hand 25 115
Net Requirements 0
(25 + 175) = 200 units available

(200 - 85) = 115 on hand at the end of Period 1

LOT SIZE: L4L LT: 1 1 2 3 4 5

Projected on Hand 25 115 20
Net Requirements 0 0
115 units available

(115 - 95) = 20 on hand at the end of Period 2

LOT SIZE: L4L LT: 1 1 2 3 4 5

Projected on Hand 25 115 20 0
Net Requirements 0 0 100
Planned Order Receipts 100
Planned Order Releases 100
20 units available
(20 - 120) = -100 — 100 additional Clipboards are required
Order must be placed in Period 2 to be received in Period 3

LOT SIZE: L4L LT: 1 1 2 3 4 5

Projected on Hand 25 115 20 0 0 0
Net Requirements 0 0 100 100 100
Planned Order Receipts 100 100 100
Planned Order Releases 100 100 100
Following the same logic Gross Requirements in Periods 4

and 5 develop Net Requirements, Planned Order Receipts, and
ITEM: LAPDESK LLC: 0 PERIOD

LOT SIZE: MULT 50 LT: 1 1 2 3 4 5
Scheduled Receipts
Net Requirements

LOT SIZE: MULT 50 LT: 1 1 2 3 4 5
Scheduled Receipts
Planned Order Receipts 50 50
Planned Order Releases 50 50
Following the same logic, the Lapdesk MRP matrix is

completed as shown
LOT SIZE: L4L LT: 1 1 2 3 4 5
LOT SIZE: MULT 50 LT: 1 1 2 3 4 5
ITEM: PRESSBOARD LLC: 1 PERIOD
LOT SIZE: MIN 100 LT: 1 1 2 3 4 5
Gross Requirements
Scheduled Receipts
Net Requirements
LOT SIZE: L4L LT: 1 1 2 3 4 5
ITEM: LAPDESK LLC: 0 x1 PERIOD x1 x1
LOT SIZE: MULT 50 LT: 1 1 2 3 4 5
ITEM: PRESSBOARD LLC: 0 x2 x2 PERIOD
LOT SIZE: MIN 100 LT: 1 1 2 3 4 5
Scheduled Receipts
Net Requirements
LOT SIZE: L4L LT: 1 1 2 3 4 5
LOT SIZE: MULT 50 LT: 1 1 2 3 4 5
ITEM: PRESSBOARD LLC: 0 PERIOD
LOT SIZE: MIN 100 LT: 1 1 2 3 4 5
Scheduled Receipts
Planned Order Receipts 100 150 100
Planned Order Report

PERIOD
ITEM 1 2 3 4 5
Clipboard 100 100 100

Lapdesk 50 50
Pressboard 100 150 100
Lot Sizing in MRP Systems
Lot-for-lot ordering policy
Fixed-size lot ordering policy
◦ Minimum order quantities
◦ Maximum order quantities
◦ Multiple order quantities
◦ Economic order quantity
◦ Periodic order quantity
Advanced Lot Sizing Rules: L4L
Total cost of L4L = (4 X $60) + (0 X $1) = $240

Advanced Lot Sizing Rules: EOQ
2(30)(60
EOQ   60 minimum order quantity
1
Total cost of EOQ = (2 X $60) + [(10 + 50 + 40) X $1)] = $220

Advanced Lot Sizing Rules: POQ
POQ  Q / d  60 / 30  2 periods worth of requirements
Total cost of POQ = (2 X $60) + ((20+40) X $1) = $180

Planned Order Report
Item #2740 Date 9 - 25 - 05
On hand 100 Lead time 2 weeks
On order 200 Lot size 200
Allocated 50 Safety stock 50
SCHEDULED PROJECTED
DATE ORDER NO. GROSS REQS. RECEIPTS ON HAND ACTION
50
9-26 AL 4416 25 25
9-30 AL 4147 25 0
10-01 GR 6470 50 - 50
10-08 SR 7542 200 150 Expedite SR 10-01
10-10 CO 4471 75 75
10-15 GR 6471 50 25
10-23 GR 6471 25 0
10-27 GR 6473 50 - 50 Release PO 10-13
Key: AL = allocated WO = work order
CO = customer order SR = scheduled receipt
PO = purchase order GR = gross requirement
MRP Action Report
Current date 9-25-05
ITEM DATE ORDER NO. QTY. ACTION

#2740 10-08 7542 200 Expedite SR 10-01
#3616 10-09 Move forward PO 10-07
#2412 10-10 Move forward PO 10-05
#3427 10-15 Move backward PO 10-25
#2516 10-20 7648 100 De-expedite SR 10-30
#2740 10-27 200 Release PO 10-13
#3666 10-31 50 Release WO 10-24
Capacity Requirements
Planning (CRP)
Creates a load profile
Identifies under-loads and over-loads
Inputs
◦ Planned order releases
◦ Routing file
◦ Open orders file
CRP
MRP planned
order
releases
Capacity Open
Routing
requirements orders
file
planning file
Load profile for

each machine center
Leveling Under-load Conditions
1. Acquire more work

2. Pull work ahead that is scheduled
for later time periods
3. Reduce normal capacity
Reducing Over-load Conditions
1. Eliminating unnecessary requirements
2. Rerouting jobs to alternative machines, workers, or
work centers
3. Splitting lots between two or more machines
4. Increasing normal capacity
5. Subcontracting
6. Increasing efficiency of the operation
7. Pushing work back to later time periods
8. Revising master schedule
Initial Load Profile
120 –
110 –
100 –
Hours of capacity
90 –
80 –
70 –
60 –
50 –
40 – Normal
capacity
30 –
20 –
10 –
0–
1 2 3 4 5 6
Time (weeks)
Adjusted Load Profile
120 –
110 –
100 –
Hours of capacity
90 –
80 –
70 – Work
an
60 – extra Push back
Pull ahead
50 – shift
Overtime Push back Normal
40 –
capacity
30 –
20 –
10 –
0–
1 2 3 4 5 6
Time (weeks)
Relaxing MRP Assumptions
Material is not always the most constraining resource
Lead times can vary
Not every transaction needs to be recorded
Shop floor may require a more sophisticated
scheduling system
Scheduling in advance may not be appropriate for on-
demand production.
Enterprise Resource Planning (ERP)
Software that organizes and manages a
company’s business processes by
◦ sharing information across functional areas
◦ integrating business processes
◦ facilitating customer interaction
◦ providing benefit to global companies
ERP Modules
Organizational Data Flows
Source: Adapted from Joseph Brady, Ellen Monk, and Bret Wagner, Concepts in
Enterprise Resource Planning (Boston: Course Technology, 2001), pp. 7–12
Selected Enterprise Software
Vendors
ERP Implementation
Analyze business processes
Choose modules to implement
◦ Which processes have the biggest impact on customer
relations?
◦ Which process would benefit the most from integration?
◦ Which processes should be standardized?
Align level of sophistication
Finalize delivery and access
Link with external partners
Customer Relationship Management
(CRM)
Software that
◦ Plans and executes business processes
◦ Involves customer interaction
◦ Changes focus from managing products to managing customers
◦ Analyzes point-of-sale data for patterns used to predict future behavior
Supply Chain Management
Software that plans and executes business
processes related to supply chains
Includes
◦ Supply chain planning
◦ Supply chain execution
◦ Supplier relationships
Distinctions between ERP and SCM are becoming
increasingly blurred
Collaborative Product Commerce (CPC)
Software that
◦ Incorporates new product design and development and product life cycle
management
◦ Integrates customers and suppliers in the design process though the entire
product life cycle
ERP and Software Systems
Customer Relationship
Management (CRM)
Customers
Time to Customer
Time to Market
Collaborative Collaborative
Design Manufacture
Collaborative Enterprise
Product Manufacture Resource
Product
Commerce
DFMA & Planning
Design
(CPC) Delivery (ERP)
Collaborative Collaborative
Design Manufacture
Suppliers
Supply Chain
Management (SCM)
Source: Adapted from George Shaw, “Building the Lean Enterprise: Reducing Time to Market.” Industry Week
(Webcast, June 14, 2001), http://www.industryweek.com/Events/TimeToMarket/ pent0614.html
Connectivity
Application programming interfaces (APIs)
◦ give other programs well-defined ways of speaking to them
Enterprise Application Integration (EAI) solutions

EDI is being replaced by XML
Closed Loop MRP
Production Planning
Master Production Scheduling
Material Requirements Planning
Capacity Requirements Planning
No
Realistic? Feedback
Feedback
Yes
Execute:
Capacity Plans
Material Plans
Manufacturing Resource Planning
(MRP II)
Goal: Plan and monitor all resources of a

manufacturing firm (closed loop):
◦ manufacturing
◦ marketing
◦ finance
◦ engineering
Simulate the manufacturing system

Question Bowl
Which type of industry has only “medium” expected
benefits from the use of MRP?
a. Assemble-to-stock
b. Fabricate-to-stock
c. Assemble-to-order
d. Fabricate-to-order
e. Process
Answer: e. Process
Question Bowl
To ensure good master scheduling, a master scheduler must do
which of the following?
a. Never lose sight of the aggregate plan
b. Identify and communicate all problems
c. Be involved with customer order promising
d. Be visible to all levels of management
e. All of the above
Answer: e. All of the above (Correct answer can also

include objectively trade off manufacturing, marketing,
and engineering conflicts and include all demands from
product sales, warehouse replenishment, spares, and
interplant requirements.)
Question Bowl
The purpose of a “time fence” is which of the
following?
a. Make sure the cows don’t get out of the barn
b. Control flow through the production system
c. Maximize sales to retailers
d. All of the above
e. None of the above
Answer: b. Control flow through the

production system
Question Bowl
Which of the following is an objective under an MRP
system?
a. To improve customer service
b. Minimize inventory investment
c. Maximize production operating efficiency
d. All of the above
Answer: d. All of the above

Question Bowl
Which of the following is one of the three
main inputs into an MRP system?
a. BOM file
b. Exception report
c. Planning report
d. All of the above
Answer: a. BOM file (Correct answer can

also include Master Schedule and Inventory
Records File.)
Question Bowl
An MRP program accesses the status of a job according
to specific time periods called which of the following?
a. Peg record
b. Time fence
c. Time bucket
d. Time clock
Answer: c. Time bucket

Question Bowl
In MRP, workload per work center can be
determined. When the work capacity is exceeded,
which of the following options can be implemented
to correct the imbalance of workload?
a. Work overtime
b. Renegotiate the due date and reschedule
c. Subcontract to an outside shop
d. All of the above
Answer: d. All of the above (Correct answer can also

include selecting an alternative work center and
rescheduling the work at a different time.)
Question Bowl
Which of the following are reasons why a Lot-For-Lot
(L4L) method of lot sizing can be used in an MRP
application?
a. Minimizes carrying costs
b. Sets planned orders to exactly match the net
requirements
c. Produces exactly what is needed
d. Does not carry any units over into future periods
e. All of the above
Answer: e. All of the above

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What is MRP and what are its main components?

What is MRP and what are its main components?

What are the main inputs into an MRP system?

What are the main inputs into an MRP system?

Material Requirements Planning (MRP)

100 tables 100 x 4 = 400 table legs

Work Purchase Rescheduling

Based on a master production schedule, a material

◦ Determines exact unit numbers needed

◦ Determines the dates when orders for those

Engineering Master production

D(2) E(1) D(3) F(2)

D(2) E(1) D(3) F(2)

LEVEL ITEM QUANTITY

Engines Exterior color Interior Interior color Body

Forward scheduling: start at today‘s date and schedule forward to determine

Projected available balance

Planned order receipt

Planned order release

C(3) C(2) D(5)

Requirements include 95 units (80 firm orders and 15 forecast) of X

C’s for On-

D Gross requirements 100

D’s for each On-

D Gross requirements 100

C’s for On-

D Gross requirements 100

1. Exploding the bill of material

Top clip (1) Bottom clip (1)

Pivot (1) Spring (1)

Item Pressboard Lead time 1

Pressboard Clip Ass’y Rivets

Top Clip Bottom Clip Pivot Spring

Master Production Schedule

Clipboard 85 95 120 100 100

Item Master File

Pressboard Clip Ass’y Rivets

Pressboard Trim Beanbag Glue

ITEM: CLIPBOARD LLC: 0 PERIOD

Gross Requirements 85 95 120 100 100

Gross Requirements 85 95 120 100 100

(25 + 175) = 200 units available

ITEM: CLIPBOARD LLC: 0 PERIOD

Gross Requirements 85 95 120 100 100

115 units available

ITEM: CLIPBOARD LLC: 0 PERIOD

Gross Requirements 85 95 120 100 100

ITEM: CLIPBOARD LLC: 0 PERIOD

Gross Requirements 85 95 120 100 100

Following the same logic Gross Requirements in Periods 4

ITEM: LAPDESK LLC: 0 PERIOD

ITEM: LAPDESK LLC: 0 PERIOD

Following the same logic, the Lapdesk MRP matrix is

Planned Order Report

Clipboard 100 100 100

Total cost of L4L = (4 X $60) + (0 X $1) = $240

Total cost of EOQ = (2 X $60) + [(10 + 50 + 40) X $1)] = $220

Total cost of POQ = (2 X $60) + ((20+40) X $1) = $180

Current date 9-25-05

ITEM DATE ORDER NO. QTY. ACTION