Oleg Blokhin Sportwear uses, for the goalkeeper gloves, a time sensitive and unstable chemical compound that must be kept in an environment where both temperature and humidity can be controlled. He uses 250 pounds per month of the chemical, estimates the holding cost to be £4.25 (because of spoilage), and estimates order costs to be £20 per order. The cost schedules of four suppliers are as follows: + Quantity 1-49 50-99 100-149 150-249 250-349 350-499 500+ Vendor 1 200-399 400-499 500+ Quantity 1-99 100-199 Price/LB (£) 36.00 34.75 33.55 32.35 Vendor 3 31.25 30.50 30.00 Price/LB (£) 34.50 33.75 32.00 31.25 30.50 Vendor 2 Quantity 1-74 75-149 150-224 225-299 300-374 375-449 450+ Price/LB (£) 35.00 34.00 32.80 31.90 31.40 30.90 30.50 Vendor 4 Quantity 1-199 200-399 400-599+ 600+ Price/LB (£) 36.00 34.00 32.00 30.00
Oleg Blokhin Sportwear uses, for the goalkeeper gloves, a time sensitive and unstable chemical compound that must be kept in an environment where both temperature and humidity can be controlled. He uses 250 pounds per month of the chemical, estimates the holding cost to be £4.25 (because of spoilage), and estimates order costs to be £20 per order. The cost schedules of four suppliers are as follows: + Quantity 1-49 50-99 100-149 150-249 250-349 350-499 500+ Vendor 1 200-399 400-499 500+ Quantity 1-99 100-199 Price/LB (£) 36.00 34.75 33.55 32.35 Vendor 3 31.25 30.50 30.00 Price/LB (£) 34.50 33.75 32.00 31.25 30.50 Vendor 2 Quantity 1-74 75-149 150-224 225-299 300-374 375-449 450+ Price/LB (£) 35.00 34.00 32.80 31.90 31.40 30.90 30.50 Vendor 4 Quantity 1-199 200-399 400-599+ 600+ Price/LB (£) 36.00 34.00 32.00 30.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Can you please explain which quantity should be ordered, and which supplier should be used?
Transcribed Image Text:Oleg Blokhin Sportwear uses, for the goalkeeper gloves, a time sensitive and unstable chemical
compound that must be kept in an environment where both temperature and humidity can be
controlled. He uses 250 pounds per month of the chemical, estimates the holding cost to be £4.25
(because of spoilage), and estimates order costs to be £20 per order. The cost schedules of four
suppliers are as follows:
+
Vendor 1
Quantity
1-49
50-99
100-149
150-249
250-349
350-499
500+
Price/LB (£)
36.00
34.75
33.55
32.35
31.25
30.50
30.00
Vendor 3
Quantity
1-99
100-199
200-399
400-499
500+
Price/LB (£)
34.50
33.75
32.00
31.25
30.50
Vendor 2
Quantity
1-74
75-149
150-224
225-299
300-374
375-449
450+
Price/LB (£)
35.00
34.00
32.80
31.90
31.40
30.90
30.50
Vendor 4
Quantity
1-199
200-399
400-599+
600+
Price/LB (£)
36.00
34.00
32.00
30.00
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Follow-up Question
|
Vendor 1 |
|
|
Quantity |
Price/LB (£) |
|
1-49 |
36.00 |
|
50-99 |
34.75 |
|
100-149 |
33.55 |
|
150-249 |
32.35 |
|
250-349 |
31.25 |
|
350-499 |
30.50 |
|
500+ |
30.00 |
|
Vendor 3 |
|
|
Quantity |
Price/LB (£) |
|
1-99 |
34.50 |
|
100-199 |
33.75 |
|
200-399 |
32.00 |
|
400-499 |
31.25 |
|
500+ |
30.50 |
|
Vendor 2 |
|
|
Quantity |
Price/LB (£) |
|
1-74 |
35.00 |
|
75-149 |
34.00 |
|
150-224 |
32.80 |
|
225-299 |
31.90 |
|
300-374 |
31.40 |
|
375-449 |
30.90 |
|
450+ |
30.50 |
|
Vendor 4 |
|
|
Quantity |
Price/LB (£) |
|
1-199 |
36.00 |
|
200-399 |
34.00 |
|
400-599+ |
32.00 |
|
600+ |
30.00 |
|
|
|
Identify and discuss what quantity should be ordered, and which supplier should be used?
Solution
by Bartleby ExpertFollow-up Question
Discuss factor(s) that should be considered besides total cost.
Solution
by Bartleby ExpertFollow-up Question
Discuss factor(s) that should be considered besides total cost.
Solution
by Bartleby ExpertKnowledge Booster
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