Your options for shipping $96,970 of machine parts from Baltimore to Kuala Lumpur, Malaysia, are (1) use a ship that will take 32 days at a cost of $3,370, or (2) truck the parts to Los Angeles andthen ship at a total cost of $5,180. The second option will take only 20 days. You are paid via a letter of credit the day the parts arrive. Your holding cost is estimated at 30% of the value per year.If you have a third option and it costs only $4,440 and also takes 20 days, what is your most economical plan?The daily holding cost of Alternative 1 is $ 79.70 . (Enter your response rounded to two decimal places.)The daily cost of faster shipping with Alternative 2 is $ 150.83. (Enter your response rounded to two decimal places.)The daily cost of faster shipping with Alternative 3 is $(Enter your response rounded to two decimal places.)

To determine the most economical plan, we need to calculate the total cost of each option and then…

Answered: Your options for shipping $96,970 of…

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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Annual demand for your product is 50,000 units. Holding cost is 25% of the value of the item. The cost, per unit, is $5.00. It costs $200 to place an order. This is a new supplier that you are thinking about buying from, and the catch is that you have to place a pretty big order in order to be able to buy from these people. You have to buy at least 6,957 units every time. What are you total costs, (including the Cost of Goods), if you choose to buy from this supplier?
Cranium, Inc., purchases term papers from an overseas supplier under a continuous review system. The average demand for a popular model is 300 units a day with a standard deviation of 30 units a day. It costs $60 to process each order and there is a five-day lead-time. The holding cost for a paper is $0.25 per year and the company policy is to maintain a 98% service level. Cranium operates 200 days per year.
Your options for shipping $100,000 of machineparts from Baltimore to Kuala Lumpur, Malaysia, are (1) usea ship that will take 30 days at a cost of $3,800 or (2) truck theparts to Los Angeles and then ship at a total cost of $4,800.The second option will take only 20 days. You are paid via aletter of credit the day the parts arrive. Your holding cost isestimated at 30% of the value per year.a) Which option is more economical?b) What customer issues are not included in the datapresented?
You have electronics store, and you are planning to buy headphones from china. The supplier in china offers you three different prices for the same headphone. The discount you will get is based on the quantity you order. Below is quotation from the supplier. PRICE RANGE QUANTITY ORDERED Headphone Price Initial price 0 to 999 $200 Discount price 1 999 to 1999 $150 Discount price 2 2000 and above $100 Annual Headphone Demand (Units) = 20000 Ordering or Setup Cost per Order ($) = 1000 holding cost percentage of unit price = 5% What should the order quantity be in order to minimize the total annual cost?
Philippine accounting
Eight Flags operates several amusement parks in the Midwest. The company stocks machine oil to service the machinery for the many rides at the parks. Eight Flags needs 30,000 gallons (D) of oil annually; the parks operate 50 weeks a year. Management is unsatisfied with the current supplier of oil and has obtained two bids from other suppliers. The data are contained in the following table. Annual Freight Costs Shipping Quantity (Q) Price/Unit Annual Holding Lead Time (L) Annual Administrative (p) $4.00 $3.90 (wks) Supplier Sharps Winkler Cost $4,000 $4,500 Cost/Unit (H) 5,000 $5,400 $5,000 10,000 $3,900 $3,600 15,000 $3,400 $3,300 $0.80 $0.78 4 Which supplier and which shipping quantity will provide the lowest costs for Eight Flags? Using V and a shipping quantity of is the lowest cost alternative, with annual total costs to Eight Flags of $ (Enter your response as an integer.)
Halifax Cigar stocks Cuban cigars that have variable lead times because of the difficulty in importing the product Lead time is normally distributed with an average of 6 weeks and a standard deviation of 1 week Demand is also a variable and normally distributed with a mean of 250 cigars per week and a standard deviation of 26 cigars Refer to the standard normal table for z-values. This exercise contains only parts a and b. a) For a 95% service level, what is the ROP? The reorder point is cigars (round your response to the nearest whole number) b) What is the ROP for a 98% service level? The reorder point is cigars (round your response to the nearest whole number)
Subject: calculus
A producer of tires has an annual demand for a specific brand of tire. Theannual demand is 14,000. The cost of ordering these tires for the distributioncenter for each order is $1,200 per order. The annual holding cost is $8.50 pertire per year (in U.S. dollars): (In Excel with formulas)a What is the EOQ and the total annual cost at EOQ?b If the company decides to place more frequent orders, then theordering cost would increase to $1,800 per order. Nevertheless, the increasedfrequency of orders would decrease the annual holding cost to $6.50 per tireper year. Should the distribution center order tires more frequently?
You have been hired to help a factory that produces nails. The factory can produce nails at a rate of 20,000 per hour and the factory runs 7 hours a day for 250 days per yéar. The annual demand for the nails is 2,800,000. It costs $100 to set up production runs for the nails. Each nail costs $0.03 to produce. The annual inventory holding costs are $0.02 for one nail. Please answer the following: (a) ignoring the production rate when determining the optimal order quantity. In other words, the manager wants to order an integer amount of nails according to the EOQ framework. Determine the amount of nails the manager orders to be produced at a time. (b) Determine the integer amount to order according to the POQ framework, the max inventory level according to this policy, the cycle time, and the amount of time spent in the 'production phase' during each cycle. (c) ordering the optimal level in (b) instead of (a). Note that although the manager ignores the production rate in (a), costs are…
Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The company operates its production facility 300 days per year. It has orders for about 12,200 flashing lights per year and has the capability of producing 95 per day. Setting up the light production costs $51. The cost of each light is $1.00. The holding cost is $0.15 per light per year. d. What is the total cost per year, including the cost of the lights? (round your response to two decimal places).
A specialty coffeehouse sells Colombian coffee at a fairly steady rate of 280 pounds annually. The beans are purchased from a local supplier for $2.40 per pound. The coffeehouse estimates that it costs $45 in paperwork and labor to place an order for the coffee, and holding costs are based on a 20 percent annual interest rate. For the situation described above, draw a graph of the amount of inventory on order. Using your graph, determine the average amount of inventory on order. Also compute the demand during the replenishment lead time. How do these two quantities differ?

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