Penalty costs can be assessed only against the number of units of demand that cannot be satisfied, or against the number of units weighted by the amount of time thatan order stays on the books. Consider the following history of supply and demandtransactions for a particular part:Number of Items Demand duringMonth Received MonthJanuary 200 520February 175 1,640March 750 670April 950 425May 500 280June 2,050 550Assume that starting inventory at the beginning of January is 480 units.a. Determine the ending inventory each month. Assume that excess demands areback-ordered.b. Assume that each time a unit is demanded that cannot be supplied immediately,a one-time charge of $10 is made. Determine the stock-out cost incurred duringthe six months (1) if excess demand at the end of each month is lost, and (2) ifexcess demand at the end of each month is back-ordered.c. Suppose that each stock-out costs $10 per unit per month that the demandremains unfilled. If demands are filled on a first-come, first-served basis, whatis the total stock-out cost incurred during the six months using this type of costcriterion? (Assume that the demand occurs at the beginning of the month forpurposes of your calculation.) Notice that you must assume that excessdemands are back-ordered for this case to make any sense.d. Discuss under what circumstances the cost criterion used in part (b) might beappropriate and under what circumstances the cost criterion used in part (c)might be appropriate.
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Penalty costs can be assessed only against the number of units of demand that cannot be satisfied, or against the number of units weighted by the amount of time that
an order stays on the books. Consider the following history of supply and demand
transactions for a particular part:
Number of Items Demand during
Month Received Month
January 200 520
February 175 1,640
March 750 670
April 950 425
May 500 280
June 2,050 550
Assume that starting inventory at the beginning of January is 480 units.
a. Determine the ending inventory each month. Assume that excess demands are
back-ordered.
b. Assume that each time a unit is demanded that cannot be supplied immediately,
a one-time charge of $10 is made. Determine the stock-out cost incurred during
the six months (1) if excess demand at the end of each month is lost, and (2) if
excess demand at the end of each month is back-ordered.
c. Suppose that each stock-out costs $10 per unit per month that the demand
remains unfilled. If demands are filled on a first-come, first-served basis, what
is the total stock-out cost incurred during the six months using this type of cost
criterion? (Assume that the demand occurs at the beginning of the month for
purposes of your calculation.) Notice that you must assume that excess
demands are back-ordered for this case to make any sense.
d. Discuss under what circumstances the cost criterion used in part (b) might be
appropriate and under what circumstances the cost criterion used in part (c)
might be appropriate.
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