11th Edition

ISBN: 9780132921145

Author: Jay Heizer

Publisher: PEARSON

Concept explainers

The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project get…

Cost Analysis

The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer …

Inventory Management

Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.

Project Management

Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective…

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Textbook Question

Chapter 12, Problem 20P

Bell Computers purchases integrated chips at $350 per chip. The holding cost is $35 per unit per year, the ordering cost is $120 per order, and sales are steady, at 400 per month. The company’s supplier, Rich Blue Chip Manufacturing, Inc., decides to offer price concessions in order to attract larger orders. The price structure is shown below.

Rich Blue Chip’s Price Structure

QUANTITY PURCHASED	PRICE/UNIT
1–99 units	$350
100–199 units	$325
200 or more units	$300

a. What is the optimal order quantity and the minimum annual cost for Bell Computers to order, purchase, and hold these integrated chips?
b. Bell Computers wishes to use a 10% holding cost rather than the fixed $35 holding cost in (a). What is the optimal order quantity, and what is the optimal annual cost?

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Chapter 12, Problem 19P

Chapter 12, Problem 21P

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Chapter 12 Solutions

Operations Management

Ch. 12 - Question 1. Describe the four types of inventory.Ch. 12 - Question 2. With the advent of low-cost...Ch. 12 - Question 3. What is the purpose of the ABC...Ch. 12 - Question 4. Identify and explain the types of...Ch. 12 - Question 5. Explain the major assumptions of the...Ch. 12 - Question 6. What is the relationship of the...Ch. 12 - Question 7. Explain why it is not necessary to...Ch. 12 - Question 8. What are the advantages of cycle...Ch. 12 - What impact does a decrease in setup time have on...Ch. 12 - When quantity discounts are offered, why is it not...

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Solution Summary: The author explains the Quantity Discount Model, where manufacturing companies receive price discount for ordering large quantities. Economic order quantity (EOQ) is the quantity of units a company must add to its inventory.

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Chapter 12 Solutions