6. The Fisher Products Company produces a line of children’s parlor games. The production process includes two departments: fabrication and assembly. The fabrication shop produces game parts, such as plastic pieces, game markers, and special indicators. The company maintains inventories both of the raw material needed to produce the game parts and of finished game parts themselves. The assembly department consists of a single assembly line that collates and packages all parlor games in Fisher’s product line to meet incoming customer orders. The company maintains no inventory of finished products (games) but produces only to customer order.

Each week the assembly foreman schedules the assembly line and supervises withdrawal of game parts from the stockroom that are needed on the assembly line to meet the production EXHIBIT A Material Requirements Planning Worksheet Week Number End Products 1 2 3 4 5 6 7 8 Game A master schedule 21 0 0 21 20 0 15 0 Game B master schedule 2 2 9 0 6 3 0 9 Toy Cup 1 2 3 4 5 6 7 8 Gross requirements Scheduled receipts*

Projected available balance 44 Planned order release Plastic Molding Material 1 2 3 4 5 6 7 8 Gross requirements Scheduled receipts* 90 Projected available balance 20 Planned order release

*Received at the beginning of each week.

Problems 237 schedule. Sometimes several games are assembled during a single week. Since the company uses MRP to plan and control production of games and game parts, the assembly foreman prepares a master production schedule for a period covering eight weeks into the future. Exhibit A shows his master schedule with two end products (games A and B).

a. A component (game part) called the toy cup is used in producing the two parlor games (A and B).

Two units of the toy cup are needed to produce one unit of game A, and one unit of the toy cup is required to produce one unit of game B. Assuming the toy cup planned lead time is one week, current on-hand inventory is 44 units, and there are no scheduled receipts, complete the MRP record for the toy cup in Exhibit A. Use the periodic order quantity ordering policy for lot sizing. Ordering cost for the toy cup is $9/order; inventory carrying cost is $0.10/unit/week.