A$).$ What is production planning? $(5$ marks$)$

B$).$ Describe the four primary manufacturing strategies. How does each affect delivery lead time? $(8$ marks$)$

C$).$ Describe five $(5)$ methods of purchasing and their application to different circumstances.

$(5$ marks$)$

D$).$ Describe each of the three basic strategies used in developing a production plan. What are the advantages and disadvantages of each. $(9$ marks$)$

E$).$ What is the mean absolute deviation $($MAD$)?$ Why is it useful in forecasting? $(6$ marks$)$

H$).$ List the seven steps in the purchasing cycle $(7$ marks$)$

QUESTION $210$ Marks

A$).$ ABC sales are $$10$ million. The company spends $$3\mathrm{.}5$ million for purchase of direct materials and $$2\mathrm{.}5$ million for direct labour; overhead is $$3\mathrm{.}5$ million and profit is $$500,000.$ Direct labour and direct material vary directly with sales, but overhead does not. The company wants to double its profit.

a$.$ By how much should the firm increase annual sales? $(2$ marks$)$

b$.$ By how much should the firm decrease material costs? $(2$ marks$)$

c$.$ By how much should the firm decrease labour cost? $(2$ marks$)$

D$).$ Michael Reid Ltd has, on the average a work$-$in$-$process lead$-$time of $10$ weeks and annual cost of goods sold of $$30$ million. Assuming that the company works $50$ weeks a year:

a$.$ What is the dollar value of the work$-$in$-$process? $(2$ marks$)$

b$.$ If the work$-$in$-$process could be reduced to $5$ weeks and the annual cost of carrying inventory was $20\%$ of the WIP inventory value, what would be the annual savings? $(2$ marks$)$

QUESTION $310$ Marks

A$).$ For the following data, calculate the daily production per worker, the number of workers required for level production and the resulting month$-$end inventories. Each worker can produce $15$ units per day, and the desired ending inventory is $9000$ units. $(2+2+6$ marks$)$

Month $1234$ Total

Working days $20241219$

Forecast demand $28000275002850028500$

Planned production

Planned inventory $11250$

QUESTION $420$ Marks

A$)$ Calculate three forecasts using the following data. First, for periods $4$ through $10,$ develop the exponentially smoothed forecasts using a forecast for period $3($F$3)$ of $45\mathrm{.}0$ and an alpha of $0\mathrm{.}4.$ Second, calculate the three$-$period moving$-$average forecast for periods $4$ through $10.$ Third, calculate the weighted moving average for periods $4$ through $10,$ using weights of $\mathrm{.}70,\mathrm{.}20,$ and $\mathrm{.}10,$ with $0\mathrm{.}70$ applied to the most recent data. Calculate the mean absolute deviation $($MAD$)$ and the cumulative sum of forecast error $($CFE$)$ for each forecasting procedure. Which forecasting procedure would you select? Why? $(4+4+5+5+2$ marks$)$

Month Demand

$145$

$248$

$343$

$448$

$549$

$654$

$747$

$850$

$946$

$1047$

QUESTION $520$ Marks

A$).$ A restaurant has tracked the number of meals served at lunch over the last four weeks. The data show little in terms of trends, but do display substantial variation by day of the week. Use the following information to determine the seasonal $($daily$)$ indices for this restaurant. Round all numbers in your calculations to four decimal places. $(10$ marks$)$

Week AVERAGE AVG Monthly SEASONAL INDEX

Day $1234$

Sunday $4035394339\mathrm{.}25$

Monday $5455515954\mathrm{.}75$

Tuesday $6160656462\mathrm{.}5$

Wednesday $7277786974$

Thursday $8980817982\mathrm{.}25$

Friday $9190999593\mathrm{.}75$

Saturday $8082818381\mathrm{.}5$

TOTAL $488$

OVERALL AVERAGE $488/7=69\mathrm{.}71$

B$)$ Perform an ABC analysis on the following set of products. $(10$ marks$)$

Item Annual Demand Unit Cost

A$211800$ $$9$

B$390100$ $$90$

C$003450$ $$6$

D$100400$ $$100$

E$70785$ $$2,000$

F$660250$ $$320$

G$473500$ $$75$

H$921100$ $$75$