ABC analysis on the following set of products Item Annual Demand Unit Cost A 211 800 R9 B 390 100 R90 C 003 450 R6 D 100 400 R100 E 707 85 R2,000 F 660 250 R320 G 473 500 R75 H 921 100 R75 Soft goods department sells 175 units per month of a certain large bath towel. The unit cost of a towel to the manufacturer is R2.50 and the cost of placing an order has been estimated to be R12.00. There is an inventory carrying charge of 27% of the unit cost per year. What is the optimal order quantity, the order frequency, and the annual holding and setup cost. If the ordering cost can be cut to R4.00, what will be the new economic order quantity, the order frequency, and annual holding and setup costs.
ABC analysis on the following set of products
Item Annual Demand Unit Cost
A 211 800 R9
B 390 100 R90
C 003 450 R6
D 100 400 R100
E 707 85 R2,000
F 660 250 R320
G 473 500 R75
H 921 100 R75
Soft goods department sells 175 units per month of a certain large bath towel. The unit cost of a towel to the manufacturer is R2.50 and the cost of placing an order has been estimated to be R12.00. There is an inventory carrying charge of 27% of the unit cost per year. What is the optimal order quantity, the order frequency, and the annual holding and setup cost. If the ordering cost can be cut to R4.00, what will be the new economic
order quantity, the order frequency, and annual holding and setup costs.
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