Given the forecast and booked orders shown in the table,and a beginning inventory of 75,what is the available to promise inventory for period 4? The company operates with a lot size of 50.

Question

Quizplus · Accepted Answer

To find the available to promise (ATP) inventory for period 4, we need to calculate the total supply and demand for that period.

Beginning inventory = 75 
+ Production plan for period 4 = 100 
= Total supply = 175

Forecast for period 4 = 130 
+ Booked orders for period 4 = 95 
= Total demand = 225

To calculate ATP, we need to subtract total demand from total supply:

Total supply - Total demand = ATP

175 - 225 = -50

This means that we have a deficit of 50 units in period 4. However, since the lot size is 50, we can produce the deficit in period 5 and still meet the demand.

Therefore, the ATP inventory for period 4 is 150 (175 - 130 - 95 = 150). Answer: A) 150.

Given the Forecast and Booked Orders Shown in the Table,and