Sky's Edge produces an unsmart cellular phone with a rotary dial, an LED digital display, and no applications. Its production cost is$125 per unit with a holding cost of $2/unit/month, a lost sales cost of $175/unit, and an overtime cost of 30/unit. The normalproduction rate is 1,200 units per month, and the beginning inventory at the start of this period is 200 units. If the demand is asshown in the following table, what is the lowest cost level output plan?January FebruaryMarchApril May JuneDemand 1,2001,5002,0002,3001,800900a. $1,173,250$1,203,250C. $1,142,250Od. $1,112,250

Step 1: To determine the lowest cost level production plan for Sky's Fudge, we need to calculate the…

Answered: Sky's Edge produces an unsmart cellular…

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 the following inventory system: average weekly (7 days a week) demand is 1000 units with a standard deviation of 100 units, review period is 28 days (4 weeks), lead time is 14 days (2 weeks) and the target service probability is 90%. Currently, inventory on hand is 500 units. How many units should be ordered? a. 6000 b. 6059 c. 6264 d. 5049 e. 5814
A part is produced in lots of 1,400 units. It is assembled from 2 components worth $30 total. The value added in production (for labor and variable overhead) is $30 per unit, bringing total costs per completed unit to $60. The average lead time for the part is 5 weeks and annual demand is 4,100 units, based on 50 business weeks per year. How many units of the part are held, on average, in cycle inventory? _______________________units. (Enter your response as an integer.) What is the dollar value of this inventory? $________________________(Enter your response as an integer.) How many units of the part are held, on average, in pipeline inventory? ________________________________units. (Enter your response as an integer.) What is the dollar value of this inventory? $________________________ (Enter your response as an integer.) (Hint: Assume that the typical part in pipeline inventory is 50 percent completed. Thus, half the labor and variable overhead cost…
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Bateman Company produces helmets for drivers of motorcycles. Helmets are produced in batches according to model and size. Although the setup and production time vary for each model, the smallest lead time is six days. The most popular model, Model HA2, takes two days for setup, and the production rate is 1,125 units per day. The expected annual demand for the model is 54,000 units. Demand for the model, however, can reach 67,500 units. The cost of carrying one HA2 helmet is $3 per unit. The setup cost is $9,000. Bateman chooses its batch size based on the economic order quantity criterion. Expected annual demand is used to compute the EOQ. Recently, Bateman has encountered some stiff competition—especially from foreign sources. Some of the foreign competitors have been able to produce and deliver the helmets to retailers in half the time it takes Bateman to produce. For example, a large retailer recently requested a delivery of 18,000 Model HA2 helmets with the stipulation that the…
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Item X is a standard item stocked in a company’s inventory of spare parts. Each year, the firm uses about 2,000 units of Item X, which costs Php 1,000 per unit. Storage costs, which include insurance and cost of capital, amount to 18 percent of item unit cost. Placing an order for more of Item X costs Php 400. The company operates 360 days per year and Item X is received 9 days after placement of order. How much would be Item X's total annual storage cost? A. Php 2,000,000 B. None of the above C. Php 8,485 D. Php 16,971 How much would be Item X's total annual stockout cost? A. None of the above B. Zero C. Php 8,485 D. Php 16,971
Item X is a standard item stocked in a company’s inventory of spare parts. Each year, the firm uses about 2,000 units of Item X, which costs Php 1,000 per unit. Storage costs, which include insurance and cost of capital, amount to 18 percent of item unit cost. Placing an order for more of Item X costs Php 400. The company operates 360 days per year and Item X is received 9 days after placement of order. How much would be Item X's total annual stockout cost? A. None of the above B. Zero C. Php 8,485 D. Php 16,971

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