Operations Management: Processes and Supply Chains (11th Edition)
11th Edition
ISBN: 9780133872132
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Question
Chapter 1, Problem 3C
Summary Introduction
Interpretation: The effect on the company’s financial model due to the production of standard furniture is to be determined.
Concept Introduction:
The company has taken a move from its traditional business and moved into the production of standard furniture. This movement has caused the company to change its financial structure in a way to reflect the cost structure changes.
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The results of your four plans will provide an indicative EOQ value. State this value and discuss in a precise manner, why it is not the exact, true value.
Additional calculations in the form of plans E, F etc. may also assist your explanation of the EOQ and can be included
i). Complete the table assuming a Level production plan.
ii) Comment on your results and explain whether at this stage, you consider a Level plan is a suitable approach for this particular business. Your comment should include reference to a calculated ‘fill rate’.
In the following sawtooth inventory profile diagram, two inventory plans with different order quantities (Q) and different frequencies of delivery are shown; order quantity for Plan A = 200 units and Plan B = 50 units.
i). Total demand (D) is 350 units, the holding cost per unit (Ch) is equal to (£0.8) and the ordering cost per order (Co) is (£12.5). Calculate the total costs for each plan and state which one is more preferable along with the reason why.
ii). There is a stark difference in the composition of the total costs of Plans A and B. Explain this difference and why it occurs. Use the breakdown of costs for each plan to help illustrate your answer.
Chapter 1 Solutions
Operations Management: Processes and Supply Chains (11th Edition)
Ch. 1 - Prob. 2DQCh. 1 - A local hospital declares that it is committed to...Ch. 1 - Prob. 4DQCh. 1 - Prob. 5DQCh. 1 - Although all nine of the competitive priorities...Ch. 1 - Choosing which processes are core to a firm’s...Ch. 1 - Prob. 8DQCh. 1 - Prob. 9DQCh. 1 - Prob. 10DQCh. 1 - Prob. 11DQ
Ch. 1 - (Refer to Solved Problem 1.) Coach Bjourn Toulouse...Ch. 1 - Prob. 2PCh. 1 - Prob. 3PCh. 1 - Prob. 4PCh. 1 - Prob. 5PCh. 1 - Prob. 6PCh. 1 - Prob. 7PCh. 1 - Prob. 8PCh. 1 - Prob. 9PCh. 1 - Prob. 1AMECh. 1 - Prob. 2AMECh. 1 - If an employee is hired, what will be the weekly...Ch. 1 - Suppose that, during the summer, the company works...Ch. 1 - Prob. 1VCCh. 1 - Prob. 2VCCh. 1 - Prob. 3VCCh. 1 - Prob. 1CCh. 1 - Prob. 2CCh. 1 - Prob. 3CCh. 1 - Prob. 4C
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