Semans is a manufacturer that produces bracket assemblies. Demand for bracket assemblies (X) is 127 units. The following is the BOM in indented form: ITEMDESCRIPTIONUSAGE
XBracket assembly1
AWall board5
BHanger subassembly2
DHanger casting3
ECeramic knob2
CRivet head screw3
FMetal tong4
GPlastic cap1
Below is a table indicating current inventory levels:

ItemXABCDEFG
Inventory27197423201262975100

b. What are the net requirements for each item? (Leave no cells blank - be certain to enter "0" wherever required.)

ItemNet Requirements
X
A
B
C
D
E
F
G

Answer and Explanation:

The computation of net requirements for each item is shown below:-

Net requirement = Gross requirement - Inventory

To compute the Gross requirement we will use the following formulas:

A = 5 × Net requirement of X

= 5 × 127

= 635

B = 2 × Net requirement of X

= 2 × 127

= 254

C = 3 × Net requirement of X

= 3 ×  127

= 381

D = 3 × Net requirement of B

= 3 × 180

= 540

E = 2 × Net requirement of B

= 2 × 180

= 360

F = 4 × Net requirement of C

= 4 × 358

= 1,432

G = 1 × Net requirement of C

= 1 × 358

= 358

Item      Gross Requirement      Inventory       Net Requirement

X                  127                              1                     127

A                   635                            19                   616

B                    254                            74                 180

C                   381                              23                  358

D                   540                             201                 339

E                    360                             262                98

F                    1,432                           975                457

G                   358                             100                 258

Therefore we have applied the net requirement formula.

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