POM WORKSHOP WORKSHEET.

DAY 1 – 25-05-2020
A1) Suitable Economic location
1) TC = TFC + TVC.
Fixed cost Variable cost Total cost

A 450000 2500*100= 700000

250000

B 500000 2500*90= 725000

225000

C 480000 2500*95= 717500

237500

According to above calculations the best location is A

because it has low cost.
2) BEPs
BEP(units) = FC/Contribution
BEP(Rs.) = FC/P.V ratio
P.V ratio= Contribution/Sales

BEPs(units) FC Contribution= FC/Contribution

Sales-VC
per unit

A 450000 150-100= 50 450000/50=

9000

B 500000 145-90= 55 500000/55=

 9091

C 480000 155-95= 60 480000/60=

8000

FC P.V Ratio= FC/P.V Ratio

Contribution/sales
BEPs(Rs.)

A 450000 50/150=0.33 450000/0.33=

1363637

B 500000 55/145=0.38 500000/0.38=

1315789.4

C 480000 60/155=0.39 480000/0.39=

1230769.2

Here, location C should be selected as it delivers

BEP with lowest units of output in other words
they only have to sell 8000 units to reach BEP.
 A2) Potential plant location
1) BEP for all four locations
BEPs(Rs.) FC P.V Ratio= FC/P.V Ratio
Contribution/sales

A 250000 40-11/40=0.725 250000/0.725=

344827.5

B 100000 40-30/40=0.25 100000/0.25=

400000

C 150000 40-20/40=0.5 150000/.0.5=

300000

D 200000 40-35/40=0.125 200000/0.125=

1600000

2) ECONOMIC LOCATION
TC = TFC + TVC.
Fixed cost Variable cost Total cost

A 250000 8000*11= 338000

88000

B 100000 8000*30= 340000

240000

C 150000 8000*20= 310000

 160000

D 200000 8000*35= 480000

280000

Location is C will provide the lowest cost.

x Volume Cumulative volume

300 4000 4000
375 6000 10000
470 3000 13000
DAY 2 – 26-05-2020
A2) MEDIAN MODEL
Y Volume Cumulative volume
180 3000 3000
320 4000 7000
470 6000 13000
MEDIAN- N/2 TH item = 13000/2 = 6500
MEDIAN- N/2 TH item = 13000/2 = 6500
COORDINATES OF LOCATION (X, Y) = (375,320)

X Y VOLUME COS D TC
T
300 320 4000 1 M(375-300)+M(320-320) 75 30000
375 470 6000 1 M(375-375)+M(320-420) 100 600000
470 180 3000 1 M(375-470)+M(320-180) 235 705000
TTC 1335000
DISTANCE = modulus (X-Xi) + modulus (Y- Yi)
A3) CENTRE OF GRAVITY
CX= SUM(XI*LI)/SUM(LI)
CY =SUM(YI*LI)/SUM(LI)
DISTANCE = SQ. ROOT[SQUARE(CX-XI) + SQUARE(CY-YI)]

X Y LOAD X*L Y*L COST DISTANCE TC=LCD

200 200 75 15000 15000 1 247 18525
100 500 105 10500 52500 1 149 15645
250 600 135 33750 81000 1 156.4 21114
500 300 60 30000 18000 1 299 17940
375 89250 166500 TTC 73224
= CX = 89250/375 = 238
= CY = 166500/375 = 444

FACTORS FR L1 L2 FR*L1 FR*L2

INCOME 5 75 70 375 350
GROWTH 3 60 80 180 240
TRANSPORTATION 4 45 90 180 360
LABOUR COST 5 80 65 400 325
TFR 1135 1275
A4) FACTOR RATING METHOD
Location 2 should be selected as it has highest ratings.

A B C
 A 55 40
B 25
C
DAY 3 – 27-05-2020
A1) EXISTING LAYOUT
A B C
A 10 20
B 10
C
DISTANCE MATRIX
TOTAL COST
A B C TOTAL
A 550 800 1350

B 250 250
C TOTA 1600

A B C
A 20 10
B 10
C
PROPOSED LAYOUT

DISTANCE MATRIX

A B C TOTAL
A 1100 400 1500
B 250 250
C TOTA 1750

L
TOTAL COST

The proposed layout should not be selected as it

delivers high cost as compared to existing layout.

A B C D
A 25 60 45
B 30 57
C 60
 D
A2) EXISTING LAYOUT
A B C D
A 10 20 20
B 10 10
C 20
D

DISTANCE MATRIX

A B C D TOTAL
A 250 1200 900 2350
B 300 570 870
C 1200 1200
D TOTAL 4420
TOTAL COST
 A B C D
A 10 20 10
B 10 20
C 10
D
PROPOSED LAYOUT

DISTANCE MATRIX

A B C D TOTAL
A 250 1200 450 1900
B 300 1140 1440
C 600 600
D TOTAL 3940
TOTAL COST
THE PROPOSED LAYOUT SHOULD BE SELECTED AS IT
HAS DELIVERS LOW COST
Week no. 1 2 3 4 5 6 7 8
Gross req. 100 150
Scheduled receipts
Stock in hand
Planned order 100 150
receipts
Net Req. 100 150
Planned order 150 150
releases
DAY 4 – 28-05-2020
A2) Material requirements planning
LT = 1 WEEK
Gross req. 200 300
Scheduled receipts
Stock in hand
Planned order 200 300
receipts
Net Req. 200 300
Planned order 200 300
releases
LT = 2 WEEK

Week no. 1 2 3 4 5 6 7 8
Gross req. 100 150
Scheduled receipts
Stock in hand
Planned order 100 150
receipts
Net Req. 100 150
Planned order 100 150
releases
LT = 1 WEEK
Gross req. 400 600
Scheduled receipts 70
Stock in hand 70 70 70
Planned order 330 600
receipts
Net Req. 330 600
Planned order 330 600
releases
LT = 1 WEEK