Thomas Kratzer is the purchasing manager for the headquarters of a large insurance company chain with a central inventory operation. Thomas's fastest-moving inventory item has a demand of 5,900 units per year. The cost of each unit is $101, and the inventory carrying cost is $11 per unit per year. The average ordering cost is $31 per order. It takes about 5 days for an order to arrive, and the demand for 1 week is 118 units. (This is a corporate operation, and there are 250 working days per year).a) What is the EOQ? [ ] units (round your response to two decimal places).b) What is the average inventory if the EOQ is used? [ ] units (round your response to two decimal places).c) What is the optimal number of orders per year? [ ] orders (round your response to two decimal places).d) What is the optimal number of days in between any two orders? [ ] days (round your response to two decimal places).e) What is the annual cost of ordering and holding inventory? $[ ] per year (round your response to two decimal places).f) What is the total annual inventory cost, including the cost of the 5,900 units? $[ ] per year (round your response to two decimal places).

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Answered: a) What is the EOQ? units (round your…

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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is not among one of the assumptions of the basic Economic Order Quantity (EOQ) model O a. Annual demand requirements are known and constant. Ob. Each order is received in a single delivery. Oc. Quantity discounts are available. O d. Lead time does not vary.
Q5- B- Fill in the blanks with appropriate words: a) Crash time is an amount of time b) The main task of Project Crashing is - c) The function of the economic order quantity EOQ model is to d) The number of ordering during the year is known as e) There are several variations of the EOQ model, depending on the -
a) The average monthly demand requirement = ____units (round to nearest whole number.) B) The total stockout cost = $____(nearest whole number) C) The total inventory carrying cost = $____(nearest whole number) D) The total cost, excluding normal time labor costs, is = $_____(nearest whole number)
L. Houts Plastics is a large manufacturer of injection-molded plastics in North Carolina. An investigation of the company's manufacturing facility in Charlotte yields the information presented in the ← table below: How would the plant classify these items according to an ABC classification system? (Round dollar volume to the nearest whole number and percentage of dollar volume to two decimal places) Item Code Avg. Inventory (units) 1289 2347 2349 2363 2394 2395 L. Houts Plastics Charlotte Inventory Levels Value Dollar Volume (S/unit) 3.50 6782 7844 8210 8310 9111 360 300 120 65 60 25 222216 20 10 7 4.00 2.50 1.80 1.75 2.25 1.15 2.05 1.60 2.00 3.00 1,200 300 105 23 25 14 18 3,134 % of Dollar Volume 38.29 9.57 3.35 0.73 0.78 0.45 0.57
Dave’s local college football team is playing for the national championship in next month’s bowl game, and he’s thinking about having “We’re number one” T-shirts imprinted in honor of the team. It’s too late to get the shirts before game day, but if he orders today, he can get them within a few days after the game. The shirts must be ordered in multiples of 1000, and Dave has estimated the amount of profit he will make for possible outcomes of the game. Given the following payoff table, what will Dave do if he uses the maximin criterion? The maximax criterion? The minimax regret criterion? Order no shirts $0 wins $0 loses $0 ties Order 1000 shirts $800 wins $-200 loses $200 ties Order 2000 shirts $1600 wins $-400 loses $300 ties
A company stocks an item that is consumed at the rate of 35 units each day. Every time an order is placed for new supply, $ 105 must be paid. A unit inventory held in stock will cost $ 0.15. a) What is the economic order quantity (EOQ)? b) What is the cycle time for the EOQ? c) What is the total cost for the EOQ?
Ordering Costs are associated with keeping stock over time. Select one: True False
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Firm Tezla produces the product QuickCar. Annual demand for QuickCar is 600 units per year on a continuous basis. The product has inventory holding costs of $30 per unit per year and order costs of $300 per order. It takes 30 days to receive a shipment after an order is placed. Calculate the economic order quantity (EOQ). a. 77 units b. 110 units c. 60 units d. 44 units
If D = 8,500 per month, S = $42 per order, and H= $2.50 per unit per month, a) What is the economic order quantity? The EOQ is b) How does your answer change if the holding cost doubles? The EOQ is units (round your response to the nearest whole number). The EOQ is units (round your response to the nearest whole number). c) What if the holding cost drops in half? units (round your response to the nearest whole number).
Inventory order is placed when O a. None of these O b. Only when projected or actual on hand stocks are higher than the safety stock. О с. Only when projected or actual on hand stocks value is positive. O d. Only when projected or actual stocks on hand is below zero
Please help solve all... please Geliga Bhd. is a distributor of industrial product in Johor. Item A is one of the materials needed in the production process. Item A is consumed at a steady usage at 4000 units per annum. The costs of ordering item A are invariant with respect to order size. The ordering cost has been calculated at RM30 per order. Each order is checked by an employee engaged in using item A in production who earns RM5 per hour irrespective of his output. The employee generates a contribution of RM4 per hour when he not involved in material checks and the stock check takes 5 hours. Annual holding cost amount to RM15 per unit. Required: a. Calculate the optimal order size of item A. b. The supplier of item A has recently offered Geliga Bhd. a quantity discount of RM0.24 per unit on the current price of RM24, for all orders of 400 or more units of item A.

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a) What is the EOQ? units (round your response to two decimal places). b) What is the average inventory if the EOQ is used? c) What is the optimal number of orders per year? units (round your response to two decimal places). orders (round your response to two decimal places).