Question 1A paint manufacturer uses 3,200 liters of chemicals a year. Currently the firmpurchases 400 liters per order and pays $3 per liter. To secure more long-termbusiness, the supplier is willing to sell at $2 per liter for orders that is 1,000 litersor more. The paint manufacturer incurs an ordering cost of $100 and holdingcost of 17% of the purchase price per liter.a) Determine the order size that will minimize the total cost.b) If the supplier offered the discount at 1,500 liters instead of 1,000 liters, whatorder size would minimize total cost?

Given data is Annual demand (D) = 3200 liters Purchase cost (P) = $3 per liter Order cost (S) = $100…

Answered: Question 1 A paint manufacturer uses…

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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Briefly explain the costs associated with EOQ model. If production cost goes up, what is the impact on the EOQ quantity?
03) Halifax Souvenir Company currently orders 500 units four times each year. Each order costs $12 and each unit costs $1.20 per year to carry. On average, it takes 5 days to receive an order from the supplier. The company operates 250 days per year. Required: 1. What is the EOQ? 2. Calculate total annual inventory cost under EOQ. 3. What is the current inventory cost? 4. What is the re-order point?
Economic Order QuantityA pipe manufacturer requires a chemical for making plastic at the rate of 6000gallons per year. The cost of keeping the chemical storage is $10 per gallon peryear. Ordering costs are $200 per order. The chemical is bought at $45 pergallon.What is the EOQ and the Annual Total Cost?
A. Ltd buys 400 units of an item at a purchase cost Sh.5000 per unit and ordering cost of Sh.2,000 per order placed. The carrying cost is estimated at 24% of cost of an item p.a. The Co. has received a 2% discount offer for purchases of 100 or more units. Required: a) Determine the best inventory policy for this item. b) Determine the discount level at which the firm will be indifferent between taking and not taking the discount offer.
Need in Detail (No AI)
← William Beville's computer training school, in Richmond, stocks workbooks with the following characteristics: Demand D 19,400 units/year Ordering cost S $27/order Holding cost H $5/unit/year a) The EOQ for the workbooks is 458 (round your response to the nearest whole number). b) What are the annual holding costs for the workbooks? $ 1145 (round your response to the nearest whole number). c) What are the annual ordering costs? $ (round your response to the nearest whole number).
am. 124.
8
K Cesar Rego Computers, a Mississippi chain of computer hardware and software retail outlets, supplies both educational and commercial customers with memory and storage devices. It currently faces the following ordering decision relating to purchases of disks: D S I Purchase price Discount price Quantity needed to qualify for the discount = 5,900 disks. What is the EOQ? 36,100 disks $25 22% $0.87 $0.81 EOQ = units (round your response to the nearest whole number). ncorrect
6. Wang Distributors has an annual demand for an airport metal detector of 1,000 units. The cost of a typical detector to Wang is $50. Carrying cost is estimated to be 25% of the unit cost, and the ordering cost is $40 per order. If Ping Wang, the owner, orders in quantities of 200 or more, he can get a 3% discount on the cost of the detectors. Should Wang take the quantity discount?
Question 1 The Jelly Bean operation holds an inventory of food colouring which used to colour the jelly beans. The jelly bean operation is interested in calculating the optimal ordering strategy for food colouring. Suppose the annual forecast for the necessary food colouring during a normal year of operation is 13491 litres per year. Furthermore, suppose the holding cost per litre of paint is $11.4 and every time the jelly bean operation issues an order to their supplier, a charge of $451 is added to the invoice as an ordering cost. The supplier charges $5.63 per litre of food colouring. Using the Economic Order Quantity formula, what is the optimal order size that minimises total cost (in Litres of food colouring per order)? a. 1265 litres b. 736 litres c. 1067446 litres d. 26 litres e. 1033 litres Question 2 Using the Economic Order Quantity formula and the data provided above, how many orders will have to be made in a single year? The choices below are all rounded to the nearest…

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