The cost of holding each subassembly in inventory is $0.75 per unit per weekRespond to the following and include any Materials Requirement Planning (MRP) calculations:Develop an MRP for Space Age Furniture Company using the information in the case including the production of sub-assemblies in lot sizes of 1,000.The lot size of 1,000 for sub-assemblies has produced a lumpy demand for part 3079. It costs $0.25 per week to hold any of these parts over from one week to the next. When- ever part 3079 is made, there is no set-up time, but processing takes 0.03 hour per unit. There is not any on-hand inventory of part 3079, and there are no orders in process.Ed Szewczak earns $22 per hour and gets a 50% premium for any overtime work. Lead time for both these subassemblies is one week, and no inventory is expected to be on hand for either part at the beginning of week 1. In fact, an order for 1,000 of subassem- bly 435 is due to be received in week 1, as is an order for 1,000 of subassembly 257. To minimize change over time, Space Age has decided that these subassemblies should be made in minimum quantities of 1,000 at a time, although there is no problem with capacity on the equipment that makes them. However, both of the subassemblies are produced using the same equip- ment. One of part 3079 is used in each subassembly, and one of each subassembly is used in each of the final products.Part 3079 may be produced in any quantity since the lathe that makes it is not used for anything else. 257, which is used in the Saturn microwave stand.
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435, which is used in the Gemini TV stand, and no.
The master schedule for producing these two items for the next six weeks is shown below.Master Schedule Week 1 2 3 4 5 6Gemini 600 400 700 500 400 600Saturn 300 400 400 600 300 300The part in question, 3079, is used in two different subassemblies: no. Previously Space Age had estimated that it cost $1.25 per week to store each Gemini and $1.50 per week to store each Saturn that wasn’t shipped immediately. Instead, everything in the master schedule is being produced for customer orders, so all products are shipped almost immediately. In fact, Space Age carries no finished-goods inventory. Coral wonders what can be done to alleviate this problem.Recently, Space Age began using an MRP system that has helped reduce inventories greatly and improve on-time deliveries. Skilled machinists with Ed’s experience and employment record are extremely difficult to find. As Coral knows, Ed has been with the company a long time and is an excellent, reliable employee. However, due to the workload for producing part 3079, it has been neces- sary to schedule frequent overtime for him in order to finish the necessary parts on time.Coral Snodgrass, operations manager for Space Age, has just heard from Ed’s foremen that Ed is becoming unhappy about so much overtime. At present, Ed works a regular 40-hour week. How- ever, the machinist must be present (even if not actually attending the machine) any time one of the machines, including the lathe, is in operation. Once set up and started, the lathe can run nearly unattended. At present the machine is run by Ed Szewczak, a machinist who also operates other machines in Space Age’s shop.
3079) that requires machining on a special lathe used only for making that part. However, two of these products-the Saturn microwave stand and the Gemini TV stand-have a part (no.
These products are made in various sizes and with various features, but all follow basically the same production and assembly operations.
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Space Age Furniture Company The Space Age Furniture Company manufactures tables and cabinets to hold microwave ovens and portable televisions. Develop an MRP for Space Age Furniture Company using the information
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