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Suppose the customer (an auto manufacturer) wants to purchase in lots of 370 and that Bob's Bumpers is able to reduce setup costs to the point where 370 is now the optimal production run quantity. How much will they save in annual holding costs with this new lower production quantity?? (Display your answer to two decimal places.) 2212.07

Suppose the customer (an auto manufacturer) wants to purchase in lots of 370 and that Bob's Bumpers is able to reduce setup costs to the point where 370 is now the optimal production run quantity. How much will they save in annual holding costs with this new lower production quantity?? (Display your answer to two decimal places.) 2212.07

Practical Management Science
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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I just need question 4 - Please show your work in excel to know where the numbers come from.

JL.53 Bob's Bumpers has a repetitive manufacturing facility in Kentucky that makes automobile bumpers and other auto body parts. The facility operates 320 days per year and has annual demand of 52,000 bumpers. They can produce up to 385 bumpers each day. It costs $66 to set up the production line to produce bumpers. The cost of each bumper is $84 and annual holding costs are $32 per unit. Setup labor cost is $27 per hour. What is the optimal size of the production run for bumpers? (Display your answer to the nearest whole number.) 609 Based on your answer to the previous question, and assuming the manufacturer holds no safety stock, what would be the average inventory for these bumpers? (Display your answer to the nearest whole number.) 305 Based on your answer two questions back, how many production runs will be required each year to satisfy demand? HINT: As a general rule, whenever calculating a value that is based on previous calculations in Excel, always be sure to use cell references rather than a rounded value as a calculation input. (Display your answer to the nearest whole number.) 85 Suppose the customer (an auto manufacturer) wants to purchase in lots of 370 and that Bob's Bumpers is able to reduce setup costs to the point where 370 is now the optimal production run quantity. How much will they save in annual holding costs with this new lower production quantity? (Display your answer to two decimal places.) 2212.07 How much will they save in annual setup costs with this new lower production quantity? (Display your answer to two decimal places.) 2212.07
Transcribed Image Text:JL.53 Bob's Bumpers has a repetitive manufacturing facility in Kentucky that makes automobile bumpers and other auto body parts. The facility operates 320 days per year and has annual demand of 52,000 bumpers. They can produce up to 385 bumpers each day. It costs $66 to set up the production line to produce bumpers. The cost of each bumper is $84 and annual holding costs are $32 per unit. Setup labor cost is $27 per hour. What is the optimal size of the production run for bumpers? (Display your answer to the nearest whole number.) 609 Based on your answer to the previous question, and assuming the manufacturer holds no safety stock, what would be the average inventory for these bumpers? (Display your answer to the nearest whole number.) 305 Based on your answer two questions back, how many production runs will be required each year to satisfy demand? HINT: As a general rule, whenever calculating a value that is based on previous calculations in Excel, always be sure to use cell references rather than a rounded value as a calculation input. (Display your answer to the nearest whole number.) 85 Suppose the customer (an auto manufacturer) wants to purchase in lots of 370 and that Bob's Bumpers is able to reduce setup costs to the point where 370 is now the optimal production run quantity. How much will they save in annual holding costs with this new lower production quantity? (Display your answer to two decimal places.) 2212.07 How much will they save in annual setup costs with this new lower production quantity? (Display your answer to two decimal places.) 2212.07
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