Operations Management: Sustainability and Supply Chain Management (12th Edition)
Operations Management: Sustainability and Supply Chain Management (12th Edition)
12th Edition
ISBN: 9780134130422
Author: Jay Heizer, Barry Render, Chuck Munson
Publisher: PEARSON
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Chapter 12, Problem 19P

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 12,000 flashing lights per year and has the capability of producing 100 per day. Setting up the light production costs $50. The cost of each light is $1. The holding cost is $0.10 per light per year.

  1. a. What is the optimal size of the production run?
  2. b. What is the average holding cost per year?
  3. c. What is the average setup cost per year?
  4. d. What is the total cost per year, including the cost of the lights?
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3) A company produces a part that is used in its production process. The company produces the part at a rate of 300 units per day. The daily demand for the product is 180 units. The annual demand for the part is 54,000 units and occurs consistently over the 300 days that the company operates yearly. The company incurs a setup cost of $300 each time the item is produced. The cost of carrying the item in inventory is estimated to be 25 percent of the item's $100 cost. How many units should the company produce each production run to minimize its inventory- associated costs?
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A large manufacturer purchases a part from a supplier under a continuous review system. The average demand is 400 units a day with a standard deviation of 50 units a day. It costs $55 to process each order. The holding cost for a part is $0.2 per month and the company has a policy of maintaining a 96% service level. The company operates 315 days per year. The time from when an order is placed to when it arrives at the company from its vendor is 5 days. a- What is the reorder point? b- What order quantity would be appropriate c- What is the total annual cost for this item?

Chapter 12 Solutions

Operations Management: Sustainability and Supply Chain Management (12th Edition)

Ch. 12 - What is meant by service level?Ch. 12 - Explain the following: All things being equal, the...Ch. 12 - Describe the difference between a fixed-quantity...Ch. 12 - Explain what is meant by the expression robust...Ch. 12 - 15. What is “safety stock”? What does safety...Ch. 12 - When demand is not constant, the reorder point is...Ch. 12 - How are inventory levels monitored in retail...Ch. 12 - State a major advantage, and a major disadvantage,...Ch. 12 - L. Houts Plastics is a large manufacturer of...Ch. 12 - Boreki Enterprises has the following 10 items in...Ch. 12 - Jean-Marie Bourjollys restaurant has the following...Ch. 12 - Lindsay Electronics, a small manufacturer of...Ch. 12 - William Bevilles computer training school, in...Ch. 12 - • 12.6 If D = 8,000 per month, S = $45 per order,...Ch. 12 - Henry Crouchs law office has traditionally ordered...Ch. 12 - Matthew Liotines Dream Store sells beds and...Ch. 12 - Southeastern Bell stocks a certain switch...Ch. 12 - Lead time for one of your fastest-moving products...Ch. 12 - Annual demand for the notebook binders at Duncans...Ch. 12 - Thomas Kratzer is the purchasing manager for the...Ch. 12 - Joe Henrys machine shop uses 2,500 brackets during...Ch. 12 - Abey Kuruvilla, of Parkside Plumbing, uses 1,200...Ch. 12 - ••• 12.15 M. Cotteleer Electronics supplies...Ch. 12 - •• 12.16 Race One Motors is an Indonesian car...Ch. 12 - Radovilsky Manufacturing Company, in Hayward,...Ch. 12 - Arthur Meiners is the production manager of...Ch. 12 - Cesar Rego Computers, a Mississippi chain of...Ch. 12 - Bell Computers purchases integrated chips at 350...Ch. 12 - Wang Distributors has an annual demand for an...Ch. 12 - Question 12.22 The catering manager of La Vista...Ch. 12 - Prob. 25PCh. 12 - Prob. 26PCh. 12 - Prob. 27PCh. 12 - Question 12.26 Emery Pharmaceutical uses an...Ch. 12 - Prob. 29PCh. 12 - Prob. 30PCh. 12 - Question 12.27 Barbara Flynn is in charge of...Ch. 12 - Question 12.28 Based on available information,...Ch. 12 - Question 12.29 Authentic Thai rattan chairs...Ch. 12 - Question 12.30 Tobacco is shipped from North...Ch. 12 - Prob. 45PCh. 12 - Question 12.32 Chicagos Hard Rock Hotel...Ch. 12 - Question 12.33 First Printing has contracts with...Ch. 12 - Prob. 48PCh. 12 - Question 12.40 A gourmet coffee shop in downtown...Ch. 12 - Question 12.36 Cynthia Knotts oyster bar buys...Ch. 12 - Question 12.37 Henrique Correas bakery prepares...Ch. 12 - Question 12.38 University of Florida football...Ch. 12 - Question Zhou Bicycle Company Zhou Bicycle...Ch. 12 - Question Zhou Bicycle Company Zhou Bicycle...Ch. 12 - Question Zhou Bicycle Company Zhou Bicycle...Ch. 12 - Parker Hi-Fi Systems Parker Hi-Fi Systems, located...Ch. 12 - Parker Hi-Fi Systems Parker Hi-Fi Systems, located...Ch. 12 - Parker Hi-Fi Systems Parker Hi-Fi Systems, located...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Question Frito-Lay has flourished since its...Ch. 12 - Inventory Control at Wheeled Coach Video Case...Ch. 12 - Prob. 2.2VCCh. 12 - Prob. 2.3VC
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