Problem 11-14 (Algo)Charlie's Pizza orders all of its pepperoni, olives, anchovies, and mozzarella cheese to be shipped directly from Italy. An Americandistributor stops by every four weeks to take orders. Because the orders are shipped directly from Italy, they take three weeks toarrive.Charlie's Pizza uses an average of 250 pounds of pepperoni each week, with a standard deviation of 12 pounds. Charlie's prides itselfon offering only the best-quality ingredients and a high level of service, so it wants to ensure a 90 percent probability of not stockingout on pepperoni.Assume that the sales representative just walked in the door and there are currently 450 pounds of pepperoni in the walk-in cooler.How many pounds of pepperoni would you order?Note: Use Excel's NORM.S.INV() function to find the z value. Do not round intermediate calculations. Round z value to 2 decimalplaces and final answer to the nearest whole number.Amount of pepperoni ordered

Step 1: Calculate Demand During Lead TimeFirst, we calculate the expected demand during the 3-week…

Answered: Problem 11-14 (Algo) Charlie's Pizza…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Q5 ZED Company supplies plastic crockery to fast food restaurants in metropolitan city. One of its products is a special bowl, disposable after initial use, for serving soups to its customers. Bowls are sold in pack 10 pieces at a price of Rs. 50 per pack. The demand for plastic bowl has been forecasted at a fairly steady rate of 40,000 packs every year. The company purchases the bowl direct from manufacturer at Rs. 40 per pack within a three days lead time. The ordering and related cost is Rs. 8 per order. The storage cost is 10% per cent per annum of average inventory investment. Required: (i) Calculate Economic Order Quantity. (ii) Calculate number of orders needed every year. (iii) Calculate the total cost of ordering and storage bowls for the year. (iv) Determine when should the next order to be placed. (Assuming that the company does maintain a safety stock and that the present inventory level is 333 packs with a year of 360 working days.
PROBLEM 2 The Strawberry Bread Company buys and then sells (as bread) 2.6 million bushels of wheat anmually. The wheat must be purchased in multiples of 2,000 bushels. Ordering costs, which include grain elevator removal charges of P3,500, are P5,000 per order. Annual carrying costs are 2 percent of the purchase price of PS per bushel. The company maintains a safety stock of 200,000 bushels. The delivery time is 6 weeks. REQUIRED 1. What is the EOQ? 2. At what inventory level should an order be placed to prevent having to draw on the safety stock? 3. What are the total inventory costs, including the costs of carrying the safety stock? 4. The wheat processor agrees to pay the elevator removal charges if Strawberry Bread will purchase wheat in quantities of 650,000 bushels. Would it be to Strawberry Bread s advantage to order under this alternative?
Question 12 Surrey Company sells soup packets to distributors throughout the lower mainland at a price of $24.99 per soup packet. Their annual expenditures include $48,000 in rent and utilities and $102,000 in employee salaries. On top of that, they spend $11.19 on the ingredients of each soup packet they make, How many soup packets must Surrey sell each year in order to break even?
Time left 1:03:55 A fresh food company in Oman is specialized in apples distribution in Oman. Annual sales forecast is 5640 boxes of apple. It costs OR 10 to make and receive an order and holding cost is OR 3.5 per box per year. The prices depend on quantities purchased such that the order quantities (in boxes) from 1 to 199 at a unit price RO 5; quantity 200 to 499 at a unit price 4.5 RO; and quantity 500 and more at a per unit price of 4 RO. If the discount option is considered, then what is the total annual cost of the best option including purchasing cost? O a. 21619 b. 29813 О с. None is correct O d. 25000 O e. 23548
PROBLEM 2 The Strawberry Bread Company buys and then sells (as bread) 2.6 million bushels of wheat ammally. The wheat must be purchased in multiples of 2,000 bushels. Ordering costs, which include grain elevator removal charges of P3,500, are P5,000 per order. Anmual carrying costs are 2 percent of the purchase price of PS per bushel. The maintains a safety stock of 200,000 bushels. The delivery time is 6 weeks. company REQUIRED 1. 2. What are the total inventory costs, including the costs of carying the safety stock? 3. The wheat processor agrees to pay the elevator removal charges if Strawberry Bread will purchase wheat in quantities of 650,000 bushels. Would it be to Strawberry Bread's advantage to order under this altemative? At what inventory level should an order be placed to prevent having to draw on the safety stock?
Problem 4. Lexberhomes Company sell 12.000 gallon of chili-flavored iced buko each month. Carying costs are PO.10 per gallon and ordering costs are P50 per order. The company operates 30 days per month. Requirements: 9. EOQ (round to nearest whole number) 10. Number of order per month
chapter 4 14. The toy buyer had the option of ordering stuffed animals directly from the manufacturer or from a nearby wholesaler. The manufacturer will not ship orders for less than $1,200 total list price. Delivery typically requires five weeks, and freight averages 2.5% of total billed cost. Trade discounts on the merchandise are 40% and 10%; terms are 2/10, n/30. A wholesaler located in the retailer's area stocks many of the same stuffed animals. he does not require a minimum order and will deliver at no charge in the area if the order has a total billed cost of at least $500. The manufacturer and wholesaler base cost on the same list price; however the wholesaler sells with trade discounts of 40% and 8% and terms of 1/15, n/30. What is the difference in the total net cost (including freight) of merchandise with a total list price of $1,200 from these two vendors? (Present your answer with a comma separator, dollar-sign, and rounded to the penny (i.e. $1,234.56).)
The average daily demand for rice in a rice distributor is 2,000 sacks. On busier days, it may reach 2,800 sacks. Its supplier always delivers on the 5th day from order. If the distributor uses a fixed order quantity of 40,000 sacks. How much is the expected maximum number of sacks on hand?
Exercise #2 Monokubs produces frozen gourmet vegetarian pizzas. The following information is available: Electricity bills show electricity costs of $3,000 per month plus an average of $0.02 per pizza. Payroll records show that supervisory salaries total $8,000 per month. Wage records show that wages and on-costs for production employees are $0.05 per pizza. Inspection of several invoices from ingredient suppliers indicate that the ingredients per pizza cost on average $1.90. Depreciation schedules show that the monthly depreciation on factory building and equipment is $21,000. Required: Classify the costs in terms of variable, semi-variable and fixed costs, and form a cost function used to calculate monthly production cost. Assume that 7,500 pizzas will be manufactured next month. Predict the production cost for next month.
Figure 1 Mrs. Brown's Bagel Company manufactures specialty bagels. The company buys flour in 50-pound bags that cost GHS25 each. The company uses 10,000 bags per year, and usage occurs evenly throughout the year. The average cost to carry a 50-pound bag in inventory per year is GHS4, and the cost to place an order is GHS10. The company works 250 days per year. 20. Refer to Figure 1. If Brown's lead time is four working days, the average rate of usage is 40 bags per day, and the company carries a safety stock of 20 bags, the reorder point would be a. 180 bags. b. 140 bags. c. 160 bags. d. 100 bags.
Breadmaster produces organic bread that is sold by the loaf. Each loaf requires 1/2 of a pound of flour. The bakery pays $2.00 per pound of the organic flour used in its loaves. The bakery expects to produce the following number of loaves in each of the upcoming four months: July $1540 Loaves August $1820 Loaves Sep. $1660 Loaves Oct. $1460 Loaves The bakery has a policy that it will have 20% of the following month's flour needs on hand at the end of each month. At the end of June, there were 154 pounds of flour on hand. Prepare the direct materials budget for the third quarter, with a column for each month and for the quarter. Begin the direct materials budget by determining the total quantity needed, then complete the budget. (Enter the pounds per unit as a decimal to two places. Round your calculations to the nearest whole number.)
Problem 11-19 (Algo) The annual demand for a product is 15,000 units. The weekly demand is 288 units with a standard deviation of 80 units. The cost to place an order is $32.00, and the time from ordering to receipt is six weeks. The annual inventory carrying cost is $0.10 per unit. a. Find the reorder point necessary to provide a 90 percent service probability. Note: Use Excel's NORM.S.INV() function to find the z value. Round z value to 2 decimal places. Reorder point units b. Suppose the production manager is asked to reduce the safety stock of this item by 45 percent. If she does so, what will the new service probability be? Note: Use Excel's NORM.S.DIST() function to find the correct probability for your computed z value. Round "z" value to 2 decimal places and final answer to 1 decimal place. Service probability %

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