EOQ, reorder point, and safety stock Alexis Company uses 835 units of a product per year on a continuous basis. The product has a fixed cost of $41 per order, and its carrying cost is $4 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note: Use a 365-day year to calculate daily usage.) c. Determine the reorder point. d. Indicate which of the following variables change if the firm does not hold the safety stock: (1) order cost, (2) carrying cost, (3) total inventory cost, (4) reorder point, (5) economic order quantity. a. Alexis' EOQ is units. (Round to the nearest whole number.) b. Alexis' average level of inventory is units. (Round to the nearest whole number.) c. Alexis' reorder point is units. (Round to the nearest whole number.) Which of the following will change if the firm does not hold the safety stock? (Select the best answer below.) O A. Total Inventory Cost, Reorder Point, and Economic Order Quantity Click to select your answer(s).

EOQ, reorder point, and safety stock Alexis Company uses 835 units of a product per year on a continuous basis. The product has a fixed cost of $41 per order, and its carrying cost is $4 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note: Use a 365-day year to calculate daily usage.) c. Determine the reorder point. d. Indicate which of the following variables change if the firm does not hold the safety stock: (1) order cost, (2) carrying cost, (3) total inventory cost, (4) reorder point, (5) economic order quantity. a. Alexis' EOQ is units. (Round to the nearest whole number.) b. Alexis' average level of inventory is units. (Round to the nearest whole number.) c. Alexis' reorder point is units. (Round to the nearest whole number.) Which of the following will change if the firm does not hold the safety stock? (Select the best answer below.) O A. Total Inventory Cost, Reorder Point, and Economic Order Quantity Click to select your answer(s).

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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(D) Buckley Enterprise sells a product that cost $450 per unit and has a monthly demand of 5,000 units. The annual holding cost per unit is calculated as 5% of the unit purchase price. It costs the business $75 to place a single order. Currently the business places 12 orders each year. i) What is the total stock administrative cost of Buckley's current inventory policy? ii) Is this the entity's cost minimizing solution for this product each year? Explain.
A Company has the following sales 2,000 in January, 2,200 in February, 2,800 in April and 3,000 in May. Assuming the selling prices is P100/unit. Sales for each month are expected to be collected as follows: • Month of sales: 20% • A month after sales: 50% • 2 months after sales: 30% - How much is total receipts from sales? Feb Total 12, 500 P1,250,000 P250,000 Jan Мar Apr May Units Sold Sales in Pesos Collection from months sales current Collection months sales Collection from two months from previous P150,000 P84,000 sales Total Collections from Sales 40,000 P926,000
on 1 A firm uses 500 units of a product per year on a continuous basis. The product has a carrying cost et answered of $35 per unit per year and order costs of $270 per order. It takes 28 days to receive a shipment after an order is placed and the firm requires a safety stock of 4 days usage in inventory (year ed out of 10.00 has 365 days). g question اذا كان عد د الوحدات عد د صحيح، أكتبها كما هي بدون منازل عشرية اذا لم یكن عد د الوحدات عد د صحيح، وكان عد د الوحدات يحتوي على اعشار، أكتب الوحدات شاملة منزلتين عشريتين، مثلا ظهر على الالة الحاسبة 11.23 lys 11.2265 a. Determine the reorder point. reorder point units b. Determine the economic order quantity. EOQ (5:Numerical:=87.83:1.11)}units Ps Pr
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22.Store B orders on a weekly basis. Its weekly demand is 50 units with a standard deviation of five units. The holding cost is $10 per unit per week and a 0.99 in-stock probability is desired. a) What is Store B's weekly inventory holding cost if lead time is two weeks? b) What is Store B's weekly inventory holding cost per unit?
Economic order quantity (EOQ). Tinnendo, Inc. believes it will sell 4 million zen-zens, an electronic game, this coming year. Note that this figure is for annual sales. The inventory manager plans to order zen-zens 46 times over the next year. The carrying cost is $0.04 per zen-zen per year. The order cost is $617 per order. It turns out that the marketing manager has underestimated the zen-zen market. The zen-zens are a smash, and current estimates are that the company will sell 8 million of them per year. Should the inventory manager simply double the EOQ order quantity? Find the new EOQ, and verify that it is the correct order quantity by finding the new carrying cost and new ordering cost. Should the inventory manager simply double the EOQ order quantity? (Select the best response.) A. Yes B. No What is the new EOQ? zen-zens (Round to the nearest whole unit.) What is the new annual carrying cost for the zen-zens? (Round to the nearest dollar.) What is the…
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Please assist with D, E and F urgently
The following details relate to materials used by Ohiahyeda manufacturing enterprise to produce its product.Normal consumption 4,000Normal delivery period 5yearsMaximum consumption 5,000Minimum delivery period 3yearsThe firm uses 400units per week for its production. The current unit cost of the material is GHȼ 40, the cost of ordering is GHȼ15 and the holding costs are estimated at 6% of material value per year.RequiredCalculatei. Maximum stock levelii. Minimum stock leveliii. Average stock level
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Ada is running a store to sell soft-drink and snacks. For one soft-drink, given the daily demand is 32 bottles with operating 360 days per year. The ordering cost is $10 per order and annual holding cost is $1 per bottle. Lead time is 10 days. Determine the optimal order size Determine the reorder point Determine the safety stock Determine total annual inventory cost Now, daily demand and lead time may vary. Average daily demand is 32 bottles and its standard deviation is 6 bottles.Average lead time is 10 days and its standard deviation is 4 days. Determine the reorder point Determine the safety stock with 95% service level
Activities/Assessments: Activity 9 Solve the following EOQ model problems: 1. Each year, Y Company purchases 20,000 units of an item that costs P 640 per unit. The cost of placing an order is P 480, and the cost to hold the item in inventory for one year is P 150. a. Determine the EOQ. b. What is the average inventory level, assuming that the minimum inventory level is zero? c. Determine the total annual ordering cost and the total annual holding cost for the item if the EOQ is used. 2. A toy manufacturer uses approximately 32,000 silicon chips annually. The chips are used at a steady rate during the 240 days the plant operates. Annual holding cost is P27 per chip and ordering cost is P1,080. Lead time = 1 week. a. Find the EOQ. b. Find the reorder point. c. What would be your ordering policy for this item? d. Find the total annual cost of ordering and carrying silicon chips. 3. A large bakery buys sugar in 50-kg bags. The bakery uses an average of 1,344 bags a year. Preparing an order…

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