A fresh food company in Oman is specialized in apples distribution in Oman. Annual sales forecast is 5040 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 per unit depend on quantities purchased (in boxes) such that the order quantities 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. What is the Economic Order Quantity (EOQ) while not considering the discount? Round-up to the neares integer a. 199 O b. 180 O c. 166 O d. None is correct e. 170

A fresh food company in Oman is specialized in apples distribution in Oman. Annual sales forecast is 5040 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 per unit depend on quantities purchased (in boxes) such that the order quantities 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. What is the Economic Order Quantity (EOQ) while not considering the discount? Round-up to the neares integer a. 199 O b. 180 O c. 166 O d. None is correct e. 170

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.
Problem 20-10 (Algo) You are a newsvendor selling San Pedro Times every morning. Before you get to work, you go to the printer and buy the day’s paper for $0.50 a copy. You sell a copy of San Pedro Times for $1.25. Daily demand is distributed normally with mean = 335 and standard deviation = 67. At the end of each morning, any leftover copies are worthless and they go to a recycle bin. a. How many copies of San Pedro Times should you buy each morning? (Use Excel's NORMSINV() function to find the correct critical value for the given α-level. Round your z-value to 2 decimal places and final answer to to 2 decimal places.) b. Based on a, what is the probability that you will run out of stock? (Round your answer to the nearest whole number.)
Problem 20-10 (Algo) You are a newsvendor selling San Pedro Times every morning. Before you get to work, you go to the printer and buy the day's paper for $0.30 a copy. You sell a copy of San Pedro Times for $1.10. Daily demand is distributed normally with mean = 265 and standard deviation = 53. At the end of each morning, any leftover copies are worthless and they go to a recycle bin. a. How many copies of San Pedro Times should you buy each morning? (Use Excel's NORMSINV() function to find the correct critical value for the given a-level. Round your z-value to 2 decimal places and final answer to to 2 decimal places.) Optimal order quantity b. Based on a, what is the probability that you will run out of stock? (Round your answer to the nearest whole number.) Probability
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ABC analysis on the following set of products Item Annual Demand Unit CostA 211 800 R9B 390 100 R90C 003 450 R6D 100 400 R100E 707 85 R2,000F 660 250 R320G 473 500 R75H 921 100 R75 Soft goods department sells 175 units per month of a certain large bath towel. The unit cost of a towel to the manufacturer is R2.50 and the cost of placing an order has been estimated to be R12.00. There is an inventory carrying charge of 27% of the unit cost per year. What is the optimal order quantity, the order frequency, and the annual holding and setup cost. If the ordering cost can be cut to R4.00, what will be the new economicorder quantity, the order frequency, and annual holding and setup costs.
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A manager must set up inventory ordering systems for two new production items, P34 and P35.P34 can be ordered at any time, but P35 can be ordered only once every four weeks. The companyoperates 50 weeks a year, and the weekly usage rates for both items are normally distributed. Themanager has gathered the following information about the items.Item P34 Item P35Average weekly demand 60 units 70 unitsStandard deviation 4 units per week 5 units per weekUnit cost $15 $20Annual holding cost 30% 30%Ordering cost $70 $30Lead time 2 weeks 2 weeksAcceptable stockout risk 2.5% 2.5%a. When should the manager reorder each item?b. Compute the order quantity for P34.c. Compute the order quantity for P35 if 110 units are on hand at the time the order is placed.
Catlea Merchandising is engaged in selling school shoesfor both boys and girls in their teenage years. Catlea needs 32,000 pairs of shoes in a year in order to satisfy the market demand. It costs ₱ 48 to place an order while ₱ 8 is needed to hold each quantity of shoe in Catlea's inventory. Upon checking on Catlea's supplier, it takes 8 days in between placing an order and eventually receiving it. a. Determine the Economic Order Quantityb. Determine the number of order per monthc. Determine the reorder point
The materials manager for a billiard ball maker must periodically place orders for resin, one of the raw materials used in producing billiard balls. She knows that manufacturing uses resin at a rate of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of resin in inventory. She also knows that the order costs for resin are $100 per order, and that the lead time for delivery is four days. If the order size was 1,000 kilograms of resin, what would be the average inventory level?
A pizzeria in downtown Changloon is trying to determine the best order quantity for its pizza ingredients. The pizzeria believes it will sell 14,400 pizzas at an average price of RM8 per year. The store buys the ingredients for one pizza at a rate of RM1.50, and the storage cost for each pizza is RM0.80. The cost of ordering more ingredients is RM13. i. Determine the economic order quantity. ii. What would be the total costs for ordering the ingredients one, and five times a year?
David Alexander has compiled the following table of six itemsin inventory at Angelo Products, along with the unit cost andthe annual demand in units:IDENTIFICATION CODE UNIT COST ($) ANNUAL DEMAND(UNITS)XX1 5.84 1,200B66 5.40 1,1103CPO 1.12 89633CP 74.54 1,104R2D2 2.00 1,110RMS 2.08 961 Use ABC analysis to determine which item(s) should be care-fully controlled using a quantitative inventory technique and which item(s) should not be closely controlled.
The local supermarket buys lettuce each day to ensure really fresh produce. Each morning, any lettuce that is left from the previous day is sold to a dealer that resells it to farmers who use it to feed their animals. This week, the supermarket can buy fresh lettuce for $9.00 a box. The lettuce is sold for $17.00 a box and the dealer that sells old lettuce is willing to pay $5.00 a box. Past history says that tomorrow's demand for lettuce averages 258 boxes with a standard deviation of 41 boxes. How many boxes of lettuce should the supermarket purchase tomorrow? (Use Excel's NORM.S.INV() function to find the z value. Round your answer to the nearest whole number.) Number of boxes