Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (12th Edition)
Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (12th Edition)
12th Edition
ISBN: 9780134855424
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
bartleby

Concept explainers

bartleby

Videos

Textbook Question
Book Icon
Chapter 9, Problem 13P

Sam’s Cat Hotel operates 52 weeks per year, 6 days per week, and uses a continuous review inventory system. It Purchases kitty litter for $11.70 per bag. The following information is available about these bags. Demand = 9 0  bags / week Order Cost = $ 54 / order Annual holding cost = 27 percent of cost Desired cycle-service level = 8 0  percent Lead time = 3 weeks  ( 18 working days ) Standard deviation of weekly demand = 15 bags

Current on-hand inventory is 320 bags, with no open orders or backorders.

  1. What is the EOQ? What would be the average time between orders (in weeks)?
  2. What should R be?
  3. An inventory withdrawal of 10 bags was just made. Is it time to reorder?
  4. The store currently uses a lot size of 500 bags (i.e., Q = 5 00 ). What is the animal holding cost of this policy? Annual ordering cost? Without calculating the EOQ, how can von conclude from these two calculations that the current lot size is too large?
  5. What would be the annual cost saved by shifting from time 500-bag lot size to time EOQ?

Blurred answer
Students have asked these similar questions
Given Information Service Level - 95% (z value= 1.6649) Order Cost - $125Order Cycle (weeks) -  4, 5, 6, 7, 8Lead Time (weeks) - 2 weeksOperating Time - 52 weeks Standard deviation = 69.3237 Variable Holding Cost - 12.019% Fixed Holding Cost - 1,659,317.307   COMPUTE FOR ECONOMIC ORDER QUANTITY (EOQ) PER ORDER CYCLE.   THANK YOUUUUU
​Sam's Pet Hotel operates 52 weeks per​ year, 6 days per​ week, and uses a continuous review inventory system. It purchases kitty litter for ​$13.00 per bag. The following information is available about these​ bags:   ≻Demand=75 ​bags/week ≻Order cost=​$55.00​/order ≻Annual holding cost=25 percent of cost ≻Desired ​cycle-service level=80 percent ≻Lead time=4 weeks ​(24 working​ days) ≻Standard deviation of weekly demand=15 bags ≻Current ​on-hand inventory is 320 ​bags, with no open orders or backorders. Part 2 a. Suppose that the weekly demand forecast of 75 bags is incorrect and actual demand averages only 50 bags per week. How much higher will total costs​ be, owing to the distorted EOQ caused by this forecast​ error?   The costs will be ​$enter your response here higher owing to the error in EOQ. ​(Enter your response rounded to two decimal​ places.) a. What is the EOQ? What would the average time between orders (in weeks)? b. What should R be? c. An inventory withdraw…
Weekly Average Demand 110 Standard deviation of (weekly) demand 30 Setup cost ($) 1400 Lead time (in weeks) 2 Procurement cost ($) 200 Holding cost /unit/week ($) 3 You are given the demand and inventory related information about a grocery store’s product in the table. The store is open for 46 weeks in a year. What is the reorder point if it wants to achieve a service level of 97%? (Do not round your intermediate calculations. Round your final answers to the nearest whole number.

Chapter 9 Solutions

Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (12th Edition)

Ch. 9 - New Wave Shelving’s inventory manager would like...Ch. 9 - Yellow Press, Inc. buys paper in 1,500-pound rolls...Ch. 9 - Babble, Inc. buys 400 blank cassette tapes per...Ch. 9 - At Dot Com, a large retailer of popular books,...Ch. 9 - Leaky Pipe, a local retailer of plumbing supplies,...Ch. 9 - Sam’s Cat Hotel operates 52 weeks per year, 6...Ch. 9 - Consider again the kitty litter ordering policy...Ch. 9 - In a Q system, the demand rate for strawberry ice...Ch. 9 - Petromax Enterprises uses a continuous review...Ch. 9 - In a continuous review inventory system, the lead...Ch. 9 - In a two-bin inventory system, the demand for...Ch. 9 - You are in charge of inventory control of a highly...Ch. 9 - Your firm uses a continuous review system and...Ch. 9 - A company begins a review of ordering policies for...Ch. 9 - Prob. 22PCh. 9 - The Farmer’s Wife is a country store...Ch. 9 - Prob. 24PCh. 9 - Prob. 25PCh. 9 - Prob. 26PCh. 9 - In a P system, the lead time for a box of...Ch. 9 - Suppose that Sam’s Cat Hotel in Problem 13 uses...Ch. 9 - Your firm uses a periodic review system for all...Ch. 9 - Using the same information as in Problem 21,...Ch. 9 - Wood County Hospital consumes 1,000 boxes of...Ch. 9 - A golf specialty wholesaler operates 50 weeks per...Ch. 9 - What is the EOQ and what is the lowest total cost?Ch. 9 - What is the annual cost of holding inventory at...Ch. 9 - Prob. 3AMECh. 9 - Prob. 4AMECh. 9 - Prob. 5AMECh. 9 - Prob. 6AMECh. 9 - Comment on the sensitivity of the EOQ model to...Ch. 9 - Consider the pressures for small versus large...Ch. 9 - Prob. 2VCCh. 9 - The Marker Maker© product recently experienced an...Ch. 9 - Put yourself in Sue McCaskey’s position and...Ch. 9 - By how much do your recommendations for these two...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Knowledge Booster
Background pattern image
Operations Management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
Purchasing and Supply Chain Management
Operations Management
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Cengage Learning
Inventory Management | Concepts, Examples and Solved Problems; Author: Dr. Bharatendra Rai;https://www.youtube.com/watch?v=2n9NLZTIlz8;License: Standard YouTube License, CC-BY