Torrance Refinery produces approximately 23.1 Million barrels of gasoline peryear. A California distributor sources its gasoline from the Torrance refinery.The annual demand for gasoline at the California distributor is 5.3 Millionbarrels. The cost of storing gasoline is approximately $29 per barrel (per year).The cost of placing an order to the Torrance refinery (including shipping) is$7300 per order. Orders will be received gradually instead of delivered all atonce (hence EPQ).At what quantity will the total cost of procurement be the lowest?Round your answer to the nearest whole number. Do NOT include a comma.For example, answer like 103542 and NOT 103,542Answer: 58845Check From the previous question... Torrance Refinery produces approximately23.1 Million barrels of gasoline per year. A California distributor sourcesits gasoline from the Torrance refinery. The annual demand for gasolineat the California distributor is 5.3 Million barrels. The cost of storinggasoline is approximately $29 per barrel (per year). The cost of placingan order to the Torrance refinery (including shipping) is $7300 per order.Orders will be received gradually instead of delivered all at once (henceEPQ).How many days does each production run last at the Torrance Refinery toserve the California distributor?Round your answer to 2 decimal places. For example, answer like 3.21Answer:CheckX

Given data: Production per year (p)= 23.1 Million barrel Demand per year (D) = 5.3 Million barrels…

Answered: Torrance Refinery produces…

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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Catlea Merchandising is engaged in selling school shoesfor both boys and girls in their teenage years. Catlea needs 32,000 pairs of shoes in a year in order to satisfy the market demand. It costs ₱ 48 to place an order while ₱ 8 is needed to hold each quantity of shoe in Catlea's inventory. Upon checking on Catlea's supplier, it takes 8 days in between placing an order and eventually receiving it. a. Determine the Economic Order Quantityb. Determine the number of order per monthc. Determine the reorder point
BIKO is a bike retailer located in the outskirts of Paris. BIKO purchases bikes from PMX in orders of 250 bikes which is the current economic order quantity. PMX is now offering the following bulk discounts to its customers: 2% discount on orders above 200 units 4% discount on orders above 500 units 6% discount on orders above 600 units BIKO is wondering if the EOQ model is still the most economical and whether increasing the order size would actually be more beneficial. Following information is relevant to forming the decision: Annual demand is 5000 units Ordering cost is $100 per order Annual holding cost is comprised of the following: 5% insurance premium for the average inventory held during the year calculated using the net purchase price Warehousing cost of $6 per unit Purchase price is $200 per unit before discount (Hint: We need to compare the total inventory cost of the order quantities at the various discount levels with that of the economic order quantity)
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ABC Company placed an order on December 1. It normally receives the order after 9 days. If the company has a normal usage of 10 units per day. What is the re-order point?
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Gentle Ben's Bar and Restaurant uses 7,200 quart bottles of an imported wine each year. The effervescent wine costs $9 per bottle and is served only in whole bottles because it loses its bubbles quickly. Ben figures that it costs $25 each time an order is placed, and holding costs are 40 percent of the purchase price. It takes six weeks for an order to arrive. Weekly demand is 144 bottles (closed two weeks per year) with a standard deviation of 40 bottles. Ben would like to use an inventory system that minimizes inventory cost and will provide a 99 percent service probability. a. What is the economic quantity for Ben to order? b. At what inventory level should he place an order?
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