A Carrefour supermarket in Ajman uses a supplier in Fujairah for a particular brand of bottled water. The annual demand for this product is 42,000 units (bottles of water). This Carrefour purchases bottled water from its supplier at a price of 0.8 Dirhams per bottle. The inventory holding cost per bottle of water per year is 0.4 Dirhams. The ordering cost for this Carrefour is 80 Dirhams per order; and the lead-time is 2 days. The company operates 260 days a year. This Carrefour uses the basic EOQ model to manage its inventories. Note: Show all the steps and details of your calculations to get full mark. Note: For questions 2.A, 2.B, and 2.C only, please use 2 decimal points in your answers This is not the case for question 2.D, as discussed in class (for ROP). Q.2.D. What is the re-order point (ROP) for this Carrefour?
A Carrefour supermarket in Ajman uses a supplier in Fujairah for a particular brand of bottled water. The annual demand for this product is 42,000 units (bottles of water). This Carrefour purchases bottled water from its supplier at a price of 0.8 Dirhams per bottle. The inventory holding cost per bottle of water per year is 0.4 Dirhams. The ordering cost for this Carrefour is 80 Dirhams per order; and the lead-time is 2 days. The company operates 260 days a year. This Carrefour uses the basic EOQ model to manage its inventories. Note: Show all the steps and details of your calculations to get full mark. Note: For questions 2.A, 2.B, and 2.C only, please use 2 decimal points in your answers This is not the case for question 2.D, as discussed in class (for ROP). Q.2.D. What is the re-order point (ROP) for this Carrefour?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A Carrefour supermarket in Ajman uses a supplier in Fujairah for a particular brand of bottled
water. The annual demand for this product is 42,000 units (bottles of water). This Carrefour
purchases bottled water from its supplier at a price of 0.8 Dirhams per bottle. The inventory
holding cost per bottle of water per year is 0.4 Dirhams. The ordering cost for this Carrefour is 80
Dirhams per order, and the lead-time is 2 days. The company operates 260 days a year. This
Carrefour uses the basic EOQ model to manage its inventories. Note: Show all the steps and
details of your calculations to get full mark. Note: For questions 2.A, 2.B, and 2.C only, please
use 2 decimal points in your answers This is not the case for question 2.D, as discussed in class
(for ROP).
Q.2.D. What is the re-order point (ROP) for this Carrefour?
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