item SKU A3378 has a demand that is normally distributed during the lead time, with a mean of a. 400 units and standard deviation of 12. If Hinsdale cannot have stockouts in more than 10% of the time in any order, how much safety stock should be maintained and at what reorder point? b. s) Calculate Hinsdale's safety stock and reorder point for three other SKUS under the following conditions of demand and lead time: SKU F5402: daily demand is normally distributed with a mean of 20, standard deviation of 5, lead time is 5 days, and must operate at a 95% service level. SKU B7319: daily demand is constant at 28 units per day, lead time is normally with a mean of 7 days and standard deviation of 4 days and must operate at a 97% service level.

item SKU A3378 has a demand that is normally distributed during the lead time, with a mean of a. 400 units and standard deviation of 12. If Hinsdale cannot have stockouts in more than 10% of the time in any order, how much safety stock should be maintained and at what reorder point? b. s) Calculate Hinsdale's safety stock and reorder point for three other SKUS under the following conditions of demand and lead time: SKU F5402: daily demand is normally distributed with a mean of 20, standard deviation of 5, lead time is 5 days, and must operate at a 95% service level. SKU B7319: daily demand is constant at 28 units per day, lead time is normally with a mean of 7 days and standard deviation of 4 days and must operate at a 97% service level.

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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Given this information:Lead-time demand 600 poundsStandard deviation of lead time demand 52 pounds (Assume normality.)Acceptable stockout risk during lead time 4 percenta. What amount of safety stock is appropriate?b. When should this item be reordered?c. What risk of stockout would result from a decision not to have any safety stock?
Problem #4 - Hinsdale Company - Modified, from textbook page #205. a. I 400 units and standard deviation of 12. If Hinsdale cannot have stockouts In more than 10% of the time in any order, how much safety stock should be maintained and at what reorder point? Item SKU A3378 has a demand that Is normally distributed during the lead time, with a mean of b. Calculate Hinsdale's safety stock and reorder point for three other SKUS under the following conditions of demand and lead time: SKU F5402: daily demand is normally distributed with a mean of 20, standard deviation of 5, lead time is 5 days, and must operate at a 95% service level. SKU B7319: daily demand is constant at 28 units per day, lead time is normally with a mean of 7 days and standard deviation of 4 days and must operate at a 97% service level. SKU F9004: daily demand is normally distributed with a mean of 22 units and a standard deviation of 5 days. The lead time is also normally distributed with a mean of 6 days, standard…
32 A local club is selling Christmas trees and deciding how many to stock for the month of December. If demand is normally distributed with a mean of 100 and standard deviation of 20, trees have no salvage value at the end of the month, trees cost $20, and trees sell for $50 what is the service level? Select one: a. .40 b. .84 c. .60 d. .20 e. unable to determine given the above information
Please show work so I can understand it. Given this information: •Expected demand during lead time = 800 units • Standard deviation of lead time demand = 40 units Assuming that lead time demand is distributed normally. The risk of stockout is 5 percent during lead time (a) What amount of safety stock is appropriate? (b) Calculate ROP
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4. A beer store uses a (Q, R) inventory system to control its stock levels. For a particularly popular black ale (a type of beer), historical data shows that the distribution of weekly demand is approximately normal, with mean 7 and standard deviation 2. Replenishment lead time for this beer store is about 5 weeks. Each unit of this beer costs the store $60. Although excess demands are back-ordered, the store owner estimates that unfilled demands cost about $100 per unit in bookkeeping and loss-of-goodwill costs. Fixed costs of replenishment are $150 per order, and holding costs are based on a 30% annual rate of interest. Assume each month is equivalent to 4 weeks. (a) What are the optimal lot sizes and reorder points for this beer? (b) What is the optimal safety stock for this beer? (c) What if the unfilled demands now incur a penalty cost of $75 per unit beer per week?
Problem 20-36 (Algo) Palin’s Muffler Shop has one standard muffler that fits a large variety of cars. The shop wishes to establish a periodic review system to manage inventory of this standard muffler. Use the information in the following table to determine the optimal inventory target level (or order-up-to level). Annual demand 3,910 mufflers Ordering cost $ 75 per order Standard deviation of daily demand 6 mufflers per working day Service probability 87 % Item cost $ 27.00 per muffler Lead time 2 working days Annual holding cost 36 % of item value Working days 230 per year Review period 18 working days a. What is the optimal target level (order-up-to level)? (Use Excel's NORMSINV() function to find the correct critical value for the given α-level. Do not round intermediate calculations. Round "z" value to 2 decimal places and final answer to the nearest whole number.) Optimal target level_________________ b. If the…
Weiss’s paint store keeps an inventory of white latex paint product in the gallon size. The manager reviews the stock level every 4 months. Demand is observed to be normally distributed with a monthly mean of 28 gallons and a standard deviation of 8. Re-supply lead time is 2.5 months. The store manager targets a 98 percent in-stock probability during the lead time. • What is the target inventory position?
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At Matthews Car Repair, customer demand for a certain brand of motor oil is normally distributed with a mean of 15 gallons and a standard deviation of 6 work-days. To be 95% sure that Compact Car Repair will not run out of oil, we should reorder when motor oil in stock is less than _______ gallons. a. 24.9 b. 22.6 c. 23.7 d. 20
Weiss’s paint store uses a (Q, R) inventory system to control its stock levels. For a particularly popular white latex paint, historical data show that the distribution of monthly demand is approximately normal, with mean 28 and standard deviation 8. Replenishment lead time for this paint is about 14 weeks. Each can of paint costs the store $6. Although excess demands are back-ordered, the store owner estimates that unfilled demands cost about $10 each in bookkeeping and loss-of-goodwill costs. Fixed costs of replenishment are $15 per order, and holding costs are basedon a 30 percent annual rate of interest.a. What are the optimal lot sizes and reorder points for this brand of paint?b. What is the optimal safety stock for this paint?
Green Grass Industries Limited (GGIL) has used a fixed-time period inventory system that involved taking a complete inventory count of all items each month. However, increasing labor costs, are forcing GGIL, to examine alternative ways to reduce the amount of labor involved in inventory stockrooms, yet without increasing other costs, such a shortage costs. Table 10 is a random sample of 20 GGIL's items. Table 10. Annual Usage by Value of a sample of GGIL's Inventory Item Number Annual Usage ($) Item Number Annual Usage ($) 1 10,600 11 2,750 2 14,000 12 1,400 3 4,000 13 3,200 4 16,000 14 2,500 5 8,100 15 110,000 1,800 16 14,800 7 84,000 17 9,500 8. 890 18 1,700 9 940 19 3,700 10 94,000 20 12,500 a) What would you recommend GGIL to do to cut back its labor cost? (Illustrate using an ABC plan). b) Item 18 is critical to continued operations at GGIL. i. How would you recommend it be classified? ii. Give the reason(s) for your answer.