A grocery store company specializing in rare and expensive foods is considering operating under a backorder policy for a particular kind of Bel- gian cheese. The company currently operates with no backorders. It costs the company $75 to place an order with the Belgian manufacturer, and pays $1500 per whecel of cheese, with a 20% annual holding cost per wheel. De- mand for the cheese is on average I wheel of cheese per week. The company operates the store 50 weeks per year. (a) What is the economic order quantity that minimizes yearly inventory cost (with no backorders)? (b) What is the total cost to operate this inventory policy? Page 3 of 8 (c) The company proposes allowing backorders. It will compensate cus- tomers by providing them a discount and promising home delivery. The company estimates the backorders will cost $680 per wheel of cheese. What is the new economic order quantity and planned backorder quan- tity under the new policy? (d) What is the total cost of the backorder policy? (e) In your opinion, which policy (backorder or no backorder) should be implemented?
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
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