Speaker Kits, Inc., developed a product structure from a bill of material in Example 1. Example 2 developed a gross requirements plan. Given the following on-hand inventory, Speaker Kits, Inc., now wants to construct a net requirements plan. The gross requirement remains 50 units in week 8, and component requirements are as shown in the product structure in Example 1.

APPROACH c A net material requirements plan includes gross requirements, on-hand inventory, net requirements, planned order receipt, and planned order release for each item. We begin with A and work backward through the components.

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ITEM ON HAND ITEM ON HAND A 10 BUD 15 20 EFG 10 5 G 0 10