A factory orders supplies every 8 days. The lead time for deliveries is 5 days. Demand for ironaverages 18 pounds per day with a standard deviation of 2.1 pounds. The holding cost for iron is$0.45 per pound per day. The restaurant wants to achieve an in-stock probability rate of 98% foriron.Round your answer to one decimal place.On average, how many pounds of iron will the factory have on hand?pounds

Given, daily demand (d) = 18Lead time (LT) = 5 daysOrder interval (OI) = 8 daysStandard deviation of…

Answered: A factory orders supplies every 8 days.…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Henderson Furniture sells reproductions of 18th-century furniture. For a particular table, the assumptions of the inventory model with backorders are valid. Annual Demand: D = 200 tables per year Inventory holding cost (as a percent of the item cost): 1 = 25% per year Item cost: C = $800 per table Ordering cost: Co = $80 per order Backordering cost: Cb = $50 per table per year The store is open 250 days a year. What is the economic order quantity that will minimize the total cost? Results are expected to be rounded to the nearest whole number. ○ A. 28 B. 5 ○ C. 13 OD. 23 E. 14 QUESTION 4 What is the backorder quantity that will minimize the total cost? Results are expected to be rounded to the nearest whole number. ○ A. 14 B. 23 C. 13 OD. 28 ○ E. 5
A bedding store has a steady demand for 300 mattresses each year. The store orders mattresses from a regional wholesaler at a cost of $50 per order. The cost of each mattress depends on the order size, and the annual holding cost for mattresses is 5% of the unit cost. The store sells the mattresses for a retail price of $250. a. Use this information to fill in the following table in your answer booklet: D Annual demand Order cost Co Holding cost ratio I Selling price per unit 7" Annual revenue rD b. The wholesaler offers the following discounts depending on the order size: Discount category Order size Discount Unit cost C 1 0-49 0% $200 2 50-99 5% $190 3 100 or more 10% $180 For each discount category, find the holding cost C₁, economic order quantity Q and total annual cost TC TC = = 10 °C ₂ + 2 = C₁ + DC Co+DC. How many mattresses should the store order at a time to minimise the total annual cost? c. Fill in the following table in your answer booklet based on the economic order…
A company that markets hypodermic needles to hospitals. The company purchases the needles from a supplier. The annual demand is 7,641 needles. The annual setup (or ordering) cost is $20 per order and the inventory holding cost per unit per year is $6.05. The company operates 258 days a year. Calculate the optimal number of orders per year for the company.
A coffee shop consumes 350 lbs of coffee per week at a steady rate. The coffee shop buys coffee from a supplier at the cost of $10 per lb, and ordering cost of $5 per order. The supplier takes 8 days to deliver an order (assume that 1 week = 7 days). What should be the reorder point (in pounds) for the coffee shop (i.e., at what level of inventory it should place an order with the supplier).
Do you think the safety stock (safety inventory) could be negative? What is the meaning of a negative safety inventory (hint: safety stock is the difference between the optimal inventory and the average demand)?
Every year XYZ Corp. sells 3,300 units of its product. It is charged $56.50 every time it reorders from its supplier and its inventory holding costs are $6.20 per unit. In order to minimize overall inventory costs, what would be the firm's average number of units that it holds?
A company that markets hypodermic needles to hospitals. The company purchases the needles from a supplier. The annual demand is 6,603 needles. The annual setup (or ordering) cost is $31 per order and the inventory holding cost per unit per year is $11.35. The company operates 293 days a year. Calculate the optimal annual holding cost for the company.Use at least 4 decimal places.
Paul’s Toy Distributor (PTD) sells 200 game consoles every week. PTD charges a $300 fixed cost for every delivery. PTD’s annual inventory holding cost is $45 per console. Assume that there are 52 weeks a year. Assume that PTD orders 1000 game consoles at a time. What is the average amount of time the consoles stay as PTD’s inventory before being sold? Find the closest answer.
Give typed full explanation
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I run a Ford car dealership, and I experience known and constant demand for cars. I sell 10,000 cars annually. The cost of ordering is $819, and the annual cost of holding a car on the lot is $500. What is the economic ordering quantity (EOQ)? Round to the nearest whole number (so if your answer is 443.363, round to 443)
Joe Birra needs to purchase malt for his microbrewery production. His supplier charges $35 per delivery (no matter how much is delivered) and $1.20 per gallon. Joe's annual holding cost per unit is 35 percent of the price per gallon. Joe uses 250 gallons of malt per week. a. Suppose Joe orders 1,000 gallons each time. What is his average inventory (in gal)? (Round your answer to 2 decimal places.) Suppose Joe orders 1,500 gallons each time. How many orders does he place with his supplier each year? How many gallons should Joe order from his supplier with each order to minimize the sum of the ordering and holding costs? (Round your answer to 3 decimal places.) Suppose Joe orders 2,500 gallons each time he places an order with the supplier. What is the sum of the ordering and holding costs per gallon? (Round your answer to 2 decimal places.) e. Suppose Joe orders the quantity from part (c) that minimizes the sum of the ordering and holding costs each time he places an order with the…

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