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MGT-655 Operations Management Assignment

   

Added on  2020-05-04

9 Pages1458 Words49 Views
Inventory Management 1Inventory Management AuthorDate
MGT-655 Operations Management Assignment_1
Inventory Management 2Introduction Inventory management is basically the supervision and control of the assets of a companythat are used in the production of the items that the said company sells. For instance, Brunswick Motors assembles engines and vehicles, and thus it is important for the company to supervise andcontrol the raw materials or the sub-assembled engine parts. Inventory represents an investment that is held up by the company until the item is sold or in other words, the asset is liquidated. TheBrunswick Company must incur the necessary costs associated with storing, tracking and insuring the inventory to avoid possible losses.Question 1 Lot-for-lot sizing is also called discrete order quantity method for lot sizing. In this method, the net requirement that occurs for each period of time is the same as the quantity of the order. Brunswick is a company that deals with expensive raw materials like engines and gearboxes and thus is required to use this method. The method is applicable in this case because the demand for such items occurs intermittently. In the case below, the quantity is exactly the similar to the case in which the period is specified in the fixed period. The gross requirement is equal to the expected demand for the products in a period. The net requirement is calculated by subtracting the previous projected inventory and the current receipt. On the other hand, the current projected inventory is equal to the previous projected inventory plus the current scheduled receipt plus the current planned order receipt minus the current gross requirement. The current planned order receipt is also called the planned order receipt which is calculated by subtracting lead time from current time. Carrying cost is
MGT-655 Operations Management Assignment_2
Inventory Management 3synonymous with the holding cost and as well the setup cost is equal to the ordering cost. Havingsaid that, the total cost incurred is the summation of the carrying cost and the setup cost.Lot-for-Lot Sizing Gear Boxes 123456789101112Gross requirements1701557101520108216Scheduled Receipts 5Projected on hand 171700000000000Net Requirements 005010158108216Planned Order Receipts005010158108216Planned order releases5010158108216Quantity 123456789101112Quantity 1701557101520108216
MGT-655 Operations Management Assignment_3

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