Net Requirements Plan

Net Requirements Plan - Net Requirements Plan 1 Net...

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Net Requirements Plan
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
2 Net Requirements Plan
Background image of page 2
3 Determining Net Requirements þ Starts with a production schedule for the end item – 50 units of Item A in week 8 þ Because there are 10 Item As on hand, only 40 are actually required – (net requirement) = (gross requirement - on- hand inventory) þ The planned order receipt for Item A in week 8 is 40 units – 40 = 50 - 10
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
4 Determining Net Requirements þ Following the lead time offset procedure, the planned order release for Item A is now 40 units in week 7 þ The gross requirement for Item B is now 80 units in week 7 þ There are 15 units of Item B on hand, so the net requirement is 65 units in week 7 þ A planned order receipt of 65 units in week 7 generates a planned order release of 65 units in week 5
Background image of page 4
5 Determining Net Requirements þ A planned order receipt of 65 units in week 7 generates a planned order release of 65 units in week 5 þ The on-hand inventory record for Item B is updated to reflect the use of the 15
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 6
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page1 / 12

Net Requirements Plan - Net Requirements Plan 1 Net...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online