A publishing Company produces books for the retail market. Demand for a current book is expected to occur at aconstant annual rate of 7500 copies. The cost of one copy of the book is $27.50. The holding cost is based on 18%annual rate, and production setup costs are $550.00. The equipment on which the book is produced has an annualproduction volume of 21,000 copies. The Company uses 250 working days per year and the lead time for aproduction run is 12 days. Assume the company is willing to tolerate one stock-out per year and that the lead timedemand follows a normal distribution with a standard deviation of 75 copies.Using an appropriate Fixed Order Quantity system model compute the following:(a) Minimum cost production lot size (whole number with no commas) -copies(b) Number of production runs per year (two decimal points) -runs(c) Cycle time (two decimal points) -days(d) Length of production run (two decimal points) -days(e) Maximum inventory (use the closest Z value, answer whole number) -copies(f) The reorder point (whole number) -copies(g) Total annual stocking cost (two decimal points with no commas) - $

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Answered: Using an appropriate Fixed Order…

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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This is in fact a production or operations scheduling system and not an inventory control system. It eliminates the holding of inventory and is based on requiring suppliers to deliver materials of the right quality to the business on the day they are needed and where they are needed.(1) Cyclical‐ordering system.(2) Materials‐requirements planning.(3) Just in time.(4) System of fixed‐order quantities.(5) Quick response system. pick which number fits
Which among the following methods assigns costs on the assumption that the inventory quantities on hand represent those last purchased or produced? Select one alternative: First-in, first-out Weighted-average cost Specific identification Last-in, first-out
Increasing the variability of either demand or lead time ________ reorder points. Group of answer choices Decreases Have no effect on Increases
Inventory order is placed when O a. Only when projected or actual stocks on hand is below zero O b. None of these O c. Only when projected or actual on hand stocks are higher than the safety stock. O d. Only when projected or actual on hand stocks value is positive.
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.
Explore the role and implications of safety stock within the framework of the Wilson approach for effective inventory control.
Increases in order cost ________ the economic order quantity. Group of answer choices DecreaseHave no Effect increase
ABC analysis is based on the presumption that carefully controlling all items is necessary to produce important inventory savings. A True B False
Suppose you have a very critical part that is used in the production of your product (so critical that it is impossible to continue production unless it is present). For such a part which of the two inventory control systems could you prefer?: Fixed Order Quantity or Fixed Order Period. Why? Explain briefly
Which of the following is not a common type of inventory? a) Raw materials b) Work-in-progress c) Finished goods d) Customer complaints
Please explain me in brief about Pros and Cons of Re-Order Point Control and Re-Order Cycle Control Inventory control Systems.
Describe the background of the inventory test of Big Five Inventory Test (BFIT) in about 200 words

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