The ranking of items in ABC inventory analysis is based on. a. b. unit price annual demand in units C. alphabetical order d. item number e. annual dollar usage
Q: Consider a two-stage plant-retailer supply chain. Lead time for orders is two weeks. Safety stock is…
A: Suspicion: Notwithstanding given information, it is accepted that the interest of 100 units stays…
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A: Following are the calculations: EOQ =2*Annual Demand*Ordering CostHolding Cost =2*125000*4009.50…
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A: Annual usage or Annual demand (A) = 97200Ordering Cost (B) = $4 per orderCarrying Cost (C) = $1.50…
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A: Cumulative % contribution:- A class items=0% to 80% B class items=80% to 95% C class items=95%…
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Q: influence
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A: We have Average annual sales (D) = 600 tires Standard deviation (σ) = 1 tire Ordering cost (O) = $40…
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Q: Perform an ABC analysis on the following set of products. Item Annual Demand Unit Cost…
A: Item Annual Demand Unit Cost Volume Cumulative volume Cumulative percent Category A211 800 9…
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A: Given: Annual demand (D) =60000 Ordering cost (S) = 200 Holding cost (H) = 1
Q: Nationwide Auto Parts uses a periodic review inventory control system for one of its stock items.…
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Q: Which one of the following variables is not explicitly considered in the computation of the Economic…
A: Storage cost is the cost incurred when inventory stock is stored and managed in the warehouse of an…
Q: Most inventory models attempt to minimize
A: Answer: Option : d) The total inventory-based costs
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A: Weekly demand= 100 bags Desired cycle-service level=92% Lead time = 1 week(s) (5 working days)…
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A: EOQ is the quantity at which ordering costs and carrying costs are minimum.EOQ= Square root of 2*…
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Q: a. What is the inventory control system for Tegdiws? Reorder quantity = 1,225 Reorder point =…
A:
Q: 6 Which of the following statements is true with regard to cycle stock? a It is also called…
A: Cycle stock is the measure of inventory that is to be utilized during a given period. The time frame…
![The ranking of items in ABC inventory analysis is based on
O a. unit price
b.
C. alphabetical order
d. item number
e. annual dollar usage
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- Cheryl Druehl has asked you to help her determinethe best ordering policy for a new product. The demand for thenew product has been forecasted to be about I ,000 units annually.To help you get a handle on the carrying and ordering costs,Cheryl has given you the list of last year's costs. She thought thatthese costs might be appropriate for the new product. She also told you that these data were compiled for 10,000 inventoryitems that were carried or held during the year. You havealso determined that 200 orders were placed last year. Your job as a new opera tions management graduate is to help Cheryl determinethe economic order quantity for the new product.ABC Corporation resells one type of candle. It has 250 working days. Each day, it sells an average of 500 boxes but maysometimes sell a maximum of 600 boxes. The supplier takes an average of 5 days to deliver the order. During busier times, thesupplier may take 7 days.Based on ABC’s records, ordering cost average P400 per order. Storage cost per box average P5 per year. There is also anopportunity cost of 1% per year for every peso invested in inventories. Each box of candles costs P450. If ABC would continue its current inventory management policy, it would keep 10,000 boxes as safety stock and order ten-days-worth of inventory. (B) Economic Order Quantity 1. How much would the total inventory related (ordering plus carrying) costs be if the economic order quantity wasfollowed (excluding safety stock)? (D) Cost-Benefit Analysis: If ABC maintains its current inventory policy for the year,1. How much would the entity save it followed the reorder point and economic order quantity models?…A printing company anticipates using 40,000 reams of paper at a uniform rate over the next year. Each time they place an order for X units of reams of paper, it is charged a flat fee of $200. Carrying costs are $4 per unit per year. A. use the formula for Economic Order Quantity to find out how many reams of paper they should purchase in each order. B. how many orders should they place over the year?
- During the last 5 weeks, demands for a certain SKU at a retailer were 7 units (5 weeks ago), 4 units, 4 units, 4 units, and 5 units (last week). The retailer uses a period review model with order-up-to level 71 units, a review period of 2 weeks, and the lead time is 11 weeks. It is time to order. How much should the retailer order?Annual demand is 16000 units, cost per order is $75 and carrying cost per unit as a percentage is 10%. The company works 250 weeks a year; the lead-time on all orders placed is 6 working days. Assuming constant lead-time demand, and a unit cost of $45 what is the economic order quantity? What is the reorder point. If lead-time demand shows variability that follows a normal distribution with a mean μ =420 and a standard deviation σ =20, what will the revised reorder point if two stock-outs (shortages) are allowed? What is the company’s reorder point if the probability of a stock-out on any cycle is restricted to 0.05?As with other products, Fisher-Price faces the decision of how many Weather Teddy units to order for the comingholiday season. Members of the management team suggested order quantities of 15,000, 18,000, 24,000, or28,000 units. The wide range of order quantities suggested indicates considerable disagreement concerning themarket potential. The product management team asks you for an analysis of the stock-out probabilities forvarious order quantities, an estimate of the profit potential, and to help make an order quantity recommendation.Fisher-Price expects to sell Weather Teddy for $24 based on a cost of $16 per unit. If inventory remains afterthe holiday season, Fisher-Price will sell all surplus inventory for $5 per unit. After reviewing the sales historyof similar products, Fisher-Price’s senior sales forecaster predicted an expected demand of 20,000 units with a.95 probability that demand would be between 10,000 units and 30,000 units. Question: One of Fisher-Price’s managers felt…
- Algro Inc. keeps a wide range of parts and materials on hand for use in its production processes. Management has recently had difficulty managing parts inventory as demand for its finished goods has increased; they frequently run out of some critical parts while having an endless supply of others. They would like to classify their parts inventory according to the ABC approach to better control inventory. The following is a list of parts, along with their annual usage and unit value: Item Annual Unit Item Annual Unit Number Usage Cost Number Usage Cost 1 36 $350 2 510 30 3 50 23 4 300 45 5 18 1900 6 500 8 7 710 4 8 80 26 9 344 28 10 67 440 11 510 2 12 682 35 13 1216 95 50 14 10 3 15 820 1 KARAN2222222222 16 60 $610 17 120 20 18 270 15 19 45 50 20 19 3200 21 910 3 12 4750 23 30 2710 24 24 1800 25 870 105 26 244 30 27 750 15 28 45 110 29 46 160 30 165 25 a. Classify the inventory items according to the ABC approach using the dollar value of annual demand. b. Clearly explain why you…Question 1 For supply item ABC, Andrews Company has been ordering 400 units per week. A new purchasing agent has been hired by the company who wants to start using the economic-order- quantity method and its supporting decision elements. She has gathered the following information: Annual demand in units Lead time, in days Ordering costs Insurance and handling costs Purchase price per unit Return on cash investment 20,800 5 $22 $7 $15 15% RequiredOretailer of white goods buys small appliances from a supplier. Their line includes rwo types of appliances for which the related data are as follows: Appliance type 2. Annual demand (units) 5235 4850 Ordering cost (TL) 125 125 Enit purchasing cost (TL) 35 25 The retailer has allocated a budget of 22,000 TL for thas procurement Assume that the aunual inventory carrying cost rate is 20 percent Caleulnte the unconstramed order quantities Are these values optimal? If not detemine the optimal quantities to be purchased from each appliance type (Hat. 0056)
- The purpose of EQQ is: A. measure the cost of ordering inventory B. to lower the level of inventory C. to determine the optimal amount of inventory to order D. to find the number of days before inventory needs to be reorderedProblem 7 Lynne Chappell manages the inventory of supplies in a large hospital. To determine which items should be closely monitored, Lynne decided to use the ABC classification schemeto group the items on the basis of their value. Asthe following table shows, she took a random sample of20 items and recorded the annual usage and unit cost ofeach. How should each item be classified?Inventory Item Unit cost(in U.S.dollars) AnnualUsageP21 $80 800A12 $400 70K43 $50 100S54 $60 90C25 $50 130D76 $30 170E27 $20 200F38 $300 90H19 $520 120Q10 $10 100R82 $20 80G65 $80 70L71 $220 200M94 $70 80V45 $15 60T62 $30 180I17 $20 80W22 $300 90O37 $700 85N88 $5 100Nationwide Auto Parts uses a periodic review inventory control system for one of its stock items. The review interval is 6 weeks, and the lead time for receiving the materials ordered from its wholesaler is 3 weeks. Weekly demand is normally distributed, with a mean of 100 units and a standard deviation of 20 units.a. What is the average and the standard deviation of demand during the protection interval?b. What should be the target inventory level if the firm desires 97.5 percent stockout protection?c. If 350 units were in stock at the time of a periodic review, how many units should be ordered?
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