End item A is made by assembling 2 parts of B and 4 parts of C. Part C is made from 3 parts of D and 2 parts of E. Gross requirements for end item A are 100 units. What is the net requirement for part C?
A) 70 units
B) 200 units
C) 125 units
D) 100 units

Question

End item A is made by assembling 2 parts of B and 4 parts of C. Part C is made from 3 parts of D and 2 parts of E. Gross requirements for end item A are 100 units.  What is the net requirement for part C?
A) 70 units 
B) 200 units 
C) 125 units 
D) 100 units

Quizplus · Accepted Answer

The gross requirements for A is 100, but there are 50 units of A in inventory, so only 50 units of A need to be produced. There are 4 Cs for each A, so the gross requirement for C is 4 × 50 = 200, but there are 75 units of C in inventory, so only 125 Cs must be produced.

End Item a Is Made by Assembling 2 Parts of B