The cumulative available-to-promise (ATP) method is based on an assumption that available inventory in a period can be committed to demand in that…

The cumulative available-to-promise (ATP) method is based on an assumption that available

inventory in a period can be committed to demand in that period and any future period in the

planning horizon. The planning horizon is the time span for which plans are made and

executed1. The cumulative ATP is a running total of the ATP figure in the master schedule, which

shows the planned production or purchase of a product over a series of time periods2. The

cumulative ATP method allows the company to account for future shortages and build up inventory

for large or seasonal orders3.

The other options are not correct. The demand time fence (DTF) is a point in the near future, usually

equal to the cumulative lead time, beyond which changes to the master schedule are not allowed4.

The cumulative ATP method does not depend on the DTF, as it considers all future periods in the

planning horizon, regardless of whether they are inside or outside the DTF. Future periods with a

planned receipt are periods where there is an expected supply of inventory from production or

purchase orders2. The cumulative ATP method does not only commit inventory to these periods, but

also to any other periods where there is demand.

Reference : Available-to-Promise (ATP) - Tutorial; Planning Horizon Definition; Demand Time Fence

(DTF) Definition; Cumulative Available-to-Promise | Cargoz.