Operations and Supply Chain Management 9th edition
9th Edition
ISBN: 9781119320975
Author: Roberta S. Russell, Bernard W. Taylor III
Publisher: WILEY
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Chapter 13, Problem 38P
Kelly’s Tavern serves Shamrock draft beer to its customers. The daily demand for beer is
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The concession stand at the Blacksburg High School stadium sells slices of pizza during soccergames. Concession stand sales are a primary source of revenue for high school athletic programs,so the athletic director wants to sell as much food as possible. However, any pizza notsold is given away to the players, coaches, and referees, or it is thrown away. The athletic directorwants to determine a reorder point that will meet, not exceed, the demand for pizza. Pizzasales are normally distributed, with a mean of 6 pizzas per hour and a standard deviation of2.5 pizzas. The pizzas are ordered from Pizza Town restaurant, and the mean delivery time is30 minutes, with a standard deviation of 8 minutes. Currently, the concession stand places an order when it has 1 pizza left. What level of service does this result in?
Palin's Muffler Shop has one standard muffler that fits a large variety of cars. The shop wishes to establish a periodic review system to
manage inventory of this standard muffler. Use the information in the following table to determine the optimal inventory target level (or
order-up-to level).
Ordering cost
Service probability
Annual demand
3,750
mufflers
$ 60
92 %
per order
mufflers per working day
per muffler
% of item value
working days
Standard deviation of daily demand
Item cost
$39.00
working days
per year
Lead time
3
Working days
Annual holding cost
Review period
31
250
20
a. What is the optimal target level (order-up-to level)? (Use Excel's NORMSINV() function to find the correct critical value for the
given a-level. Do not round intermediate calculations. Round "z" value to 2 decimal places and final answer to the nearest whole
number.)
Optimal target level
b. If the service probability requirement is 92 percent, the optimal target level will:
O Stay the same
Decrease
O…
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Chapter 13 Solutions
Operations and Supply Chain Management 9th edition
Ch. 13.S - Prob. 1QCh. 13.S - How are steady-state results achieved in a...Ch. 13.S - Prob. 3QCh. 13 - Describe the difference between independent and...Ch. 13 - Distinguish between a fixed-order-quantity system...Ch. 13 - Discuss customer service level for an inventory...Ch. 13 - Explain the ABC inventory classification system...Ch. 13 - Identify the two basic decisions addressed by...Ch. 13 - Describe the major cost categories used in...Ch. 13 - Explain how the order quantity is determined using...
Ch. 13 - What are the assumptions of the basic EOQ model,...Ch. 13 - How are the reorder point and lead lime related in...Ch. 13 - Describe how the production quantity model differs...Ch. 13 - How must the application of the basic EOQ model be...Ch. 13 - Why do the basic EOQ model variations not include...Ch. 13 - In the production quantity EOQ model, what would...Ch. 13 - Explain in general terms how a safety stock level...Ch. 13 - Explain the difference between a single-stage...Ch. 13 - AV City stocks and sells a particular brand of...Ch. 13 - AV City (Problem 13.1) assumed with certainty that...Ch. 13 - A firm is faced with the attractive situation in...Ch. 13 - The Sofaworld Company purchases upholstery...Ch. 13 - The Wallace Stationery Company purchases paper...Ch. 13 - The Ambrosia Bakery makes calms for freezing and...Ch. 13 - The EastCoasters Bicycle Shop operates 364 days a...Ch. 13 - The Chemeo Company uses a highly toxic chemical in...Ch. 13 - The Food Place Supermarket stocks Munehkin...Ch. 13 - Kroft Foods makes cheese to supply to stores in...Ch. 13 - The Shotz Brewery produces an ale that it stores...Ch. 13 - Tradewinds Imports is an importer of ceramics from...Ch. 13 - JAL Trading is a Hong Kong manufacturer of...Ch. 13 - In Problem 12.1 in Chapter 12, the Hartley-Davis...Ch. 13 - In Problem 12-2 in Chapter 12, Carpel City orders...Ch. 13 - In Problem 12.47 in Chapter 12, Delaplane...Ch. 13 - The Paramount Paper company produces paper from...Ch. 13 - Kellys Tavern serves Shamrock draft beer to its...Ch. 13 - The daily demand for Ironcoat paint at the Top...Ch. 13 - IM Systems assembles microcomputers from genetic...Ch. 13 - IM Systems assembles microcomputers from generic...Ch. 13 - KVS Pharmacy fills prescriptions fen a popular...Ch. 13 - Food Place Market stocks frozen pizzas in a...Ch. 13 - The Mediterranean Restaurant stocks a red Chilean...Ch. 13 - The Aztec Company stock a variety of parts and...Ch. 13 - The EastCoasters Bicycle Shop stocks bikes;...Ch. 13 - Tara McCoy is the office administrator for the...Ch. 13 - The concession stand at the Shelby High School...Ch. 13 - The Instant Paper Clip Office Supply Company...Ch. 13 - The Texas Gladiators Apparel Store The Texas...Ch. 13 - Pharr Foods Company Pharr Foods Company produces a...
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- 12.4 Demand for ice cream at the Ouachita Dairy can be approximated by a normal distribution with a mean of 47 gallons per day and a standard deviation of 8 gallons per day. The new management desires a service level of 95%. Lead time is four days; the dairy is open seven days a week. What reorder point would be consistent with the desired service level?arrow_forwardMaira Hijab Enterprise (MHE) is a supplier that sells Exclusive Embroidery Silk Hijabs to boutique and online resellers. The annual demand is approximately 360 hijabs. MHE pays RM50 for each hijab and estimates that the annual holding cost is 2 percent of the hijab's value. It costs approximately RM100 to place an order (managerial and clerical costs). Required: Determine the economic order quantity (EOQ) (Round up your answers to the nearest figure). а. b. Assuming a 300-day work year, how many orders should be processed per year and what is the expected time between orders? С. Calculate the total cost for the order. d. After several months of the introduction of the Exclusive Hijab, MHE decides to all costs related to their product due to the increment of hijab’s costs by the supplier. MHE currently orders 1000 hijabs per month. The new information as regards to the Exclusive Hijab is as follows: i. The ordering cost for these is RM100 per order and ii. The carrying cost is assumed…arrow_forwardThe Corner Drug Store fills prescriptions for a popular children’s antibiotic, amoxicillin. The daily demand for amoxicillin is normally distributed, with a mean of 200 ounces and a standard deviation of 80 ounces. The vendor for the pharmaceutical firm that supplies the drug calls the drugstore pharmacist every 30 days to check the inventory of amoxicillin. During a call, the druggist indicated that the store had 60 ounces of the antibiotic in stock. The lead time to receive an order is 4 days. Determine the order size that will enable the drugstore to maintain a 95% service level.arrow_forward
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