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Inventory Management You are the store manager at a local branch of DigiLife, a large electronics retail chain. A new version of a popular consumer electronics device called the Amulet is coming out this year. It is your job to sell as many Amulets as you can while minimizing your costs in order to maximize your store's profits. Your Goal Earn $1,000,000 in net profits of Amulet sales. M

Inventory Management You are the store manager at a local branch of DigiLife, a large electronics retail chain. A new version of a popular consumer electronics device called the Amulet is coming out this year. It is your job to sell as many Amulets as you can while minimizing your costs in order to maximize your store's profits. Your Goal Earn $1,000,000 in net profits of Amulet sales. M

Practical Management Science
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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Inventory Management You are the store manager at a local branch of DigiLife, a large electronics retail chain. A new version of a popular consumer electronics device called the Amulet is coming out this year. It is your job to sell as many Amulets as you can while minimizing your costs in order to maximize your store's profits. Your Goal Earn $1,000,000 in net profits of Amulet sales.
Transcribed Image Text:Inventory Management You are the store manager at a local branch of DigiLife, a large electronics retail chain. A new version of a popular consumer electronics device called the Amulet is coming out this year. It is your job to sell as many Amulets as you can while minimizing your costs in order to maximize your store's profits. Your Goal Earn $1,000,000 in net profits of Amulet sales.
Based on last year's numbers and expected trends into this year, our analysts have concluded the following about the Amulet: Cost of product: $95/unit The sales price of the Amulet is $200/unit. Supplier has confirmed that this will be the average per-unit cost when we place orders in 50-unit increments (Each box has 50 units). Costs of ordering and delivery: $6,000 per order We have reached an agreement with the shipping service. All purchases will be billed at a flat rate of $6,000 for each order placed in the normal order cycle, which requires a 5 days lead time. Rush orders will be charged $40 extra per unit. They will arrive the next day. The Accounting Department estimates the cost of holding inventory to be $1.35 per unit per day. This amount includes warehouse rental costs and insurance. Thanks, Boden Hansen
Transcribed Image Text:Based on last year's numbers and expected trends into this year, our analysts have concluded the following about the Amulet: Cost of product: $95/unit The sales price of the Amulet is $200/unit. Supplier has confirmed that this will be the average per-unit cost when we place orders in 50-unit increments (Each box has 50 units). Costs of ordering and delivery: $6,000 per order We have reached an agreement with the shipping service. All purchases will be billed at a flat rate of $6,000 for each order placed in the normal order cycle, which requires a 5 days lead time. Rush orders will be charged $40 extra per unit. They will arrive the next day. The Accounting Department estimates the cost of holding inventory to be $1.35 per unit per day. This amount includes warehouse rental costs and insurance. Thanks, Boden Hansen
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