Metro Trading owned a factory to produce the automobile parts and has the following inventory, carrying and storage costs: 1. Annual Sales is 300,000 units. 2. The carrying cost is 20% of the purchase price; 3. The purchase price is RM25 per unit; 4. The ordering cost is RMI,500 per order, 5. The desired safety stock level 8,000 units; 6. The delivery time is I week (7days). d) What is the average inventory level? e) How much does the total annual inventory cost? f) Prepare a graph to shows your order point determination.
Metro Trading owned a factory to produce the automobile parts and has the following inventory, carrying and storage costs: 1. Annual Sales is 300,000 units. 2. The carrying cost is 20% of the purchase price; 3. The purchase price is RM25 per unit; 4. The ordering cost is RMI,500 per order, 5. The desired safety stock level 8,000 units; 6. The delivery time is I week (7days). d) What is the average inventory level? e) How much does the total annual inventory cost? f) Prepare a graph to shows your order point determination.
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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