1 1. A juice manufacturing company orders 2,500 kg`s of fruits every quarter of an year. Orderingcost per order is $50. Cost of carrying and preserving the fruits in inventory is 8%/year of thevalue of average inventory. Per unit cost is $2/kg. Solve for the followinga. Quantity Q if the shelf life of fruits is 30 daysb. The economic order quantityc. total cost for both quantitiesd. What would be the extra cost for ordering EOQ?Answer:a. 822kg/orderb. 2500kg/orderc. $673 for 822kg and $400 for 2500kgd. $3,356

Economic order quantity (EOQ) is inventory management technique which helps to identify the lowest…

Answered: 1. A juice manufacturing company orders…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

See similar textbooks

Similar questions

A large distributor of oil-well drilling equipment operated over the past two years with EOQ policies based on an annual holding cost rate of 22%. Under the EOQ policy, a particular product has been ordered with a Q* 80. A recent evaluation of holding costs shows that because of an increase in the interest rate associated with bank loans, the annual holding cost rate should be 27%. a. What is the new economic order quantity for the product? b. Develop a general expression showing how the economic order quantity changes when the annual holding cost rate is changed from I to I
Oretailer of white goods buys small appliances from a supplier. Their line includes rwo types of appliances for which the related data are as follows: Appliance type 2. Annual demand (units) 5235 4850 Ordering cost (TL) 125 125 Enit purchasing cost (TL) 35 25 The retailer has allocated a budget of 22,000 TL for thas procurement Assume that the aunual inventory carrying cost rate is 20 percent Caleulnte the unconstramed order quantities Are these values optimal? If not detemine the optimal quantities to be purchased from each appliance type (Hat. 0056)
A printing company anticipates using 40,000 reams of paper at a uniform rate over the next year. Each time they place an order for X units of reams of paper, it is charged a flat fee of $200. Carrying costs are $4 per unit per year. A. use the formula for Economic Order Quantity to find out how many reams of paper they should purchase in each order. B. how many orders should they place over the year?
a. Mr. Mashabela operates a small novelty shop. Each morning he purchases a small quantity of daily computerized horoscopes at a cost of R15.00 per item. He resells them later in the day for R25.00 per horoscope. For the past 200 days, Mr. Mashianoke's demand has been 6 items on 60 days, 7 items on 60 days, 8 items on 40 days, 9 items on 20 days and 10 items on 20 days. The horoscopes come in packages of 2, which forces Mr. Mashabela to purchase an even number, and the horoscopes are salable for one day only. At the end of each working day, however, Mr. Mashabela can sell any remaining horoscopes to a night-own peddler for R10.00 per item. i) Set up the payoff matrix for the above problem. ii) Assuming the probabilities of the occurrence of the state of nature is unknown, how many computerized horoscopes should the decision maker purchase based on opportunistic loss? i) Using the expected monetary value approach, determine how many computerized horoscopes should Mr. Mashabela purchase.…
Q/ A stockiest has to supply 400 units of a product every Monday to his customers. He gets the product at Rs. 50/- per unit from the manufacturer. The cost of ordering and transportation from the manufacturer is Rs. 75 per order. The cost of carrying inventory is 7.5% per year of the cost of the product. Find:(a) Economic order quantity,(b) The total optimal cost.
Green Grass Industries Limited (GGIL) has used a fixed-time period inventory system that involved taking a complete inventory count of all items each month. However, increasing labor costs, are forcing GGIL, to examine alternative ways to reduce the amount of labor involved in inventory stockrooms, yet without increasing other costs, such a shortage costs. Table 10 is a random sample of 20 GGIL's items. Table 10. Annual Usage by Value of a sample of GGIL's Inventory Item Number Annual Usage ($) Item Number Annual Usage ($) 1 10,600 11 2,750 2 14,000 12 1,400 3 4,000 13 3,200 4 16,000 14 2,500 5 8,100 15 110,000 1,800 16 14,800 7 84,000 17 9,500 8. 890 18 1,700 9 940 19 3,700 10 94,000 20 12,500 a) What would you recommend GGIL to do to cut back its labor cost? (Illustrate using an ABC plan). b) Item 18 is critical to continued operations at GGIL. i. How would you recommend it be classified? ii. Give the reason(s) for your answer.
Describe the 3 differences between a fixed-quantity (Q) and a fixed-period (P) inventory ns4 a. system? Fixed Quality Inventory Fixed Period Inventory
David's Delicatessen flies in Hebrew National salamis regularly to satisfy a growing demand for the salamis in Silicon Valley. The owner, David Gold, estimates that the demand for the salamis is pretty steady at 175 per month. The salamis cost Gold $1.85 each. The fixed cost of calling his brother in New York and having the salamis flown in is $200. It takes three weeks to receive an order. Gold's accountant, Irving Wu, recommendsan annual cost of capital of 22 percent, a cost of shelf space of 3 percent of the value of the item, and a cost of 2 percent of the value for taxes and insurance. How many salamis should Gold have on hand when he phones his brother to send another shipment?
David’s Delicatessen flies in Hebrew National salamis regularly to satisfy a growing demand for the salamis in Silicon Valley. The owner, David Gold, estimates that the demand for the salamis is pretty steady at 175 per month. The salamis cost Gold $1.85 each. The fixed cost of calling his brother in New York and having the salamis flown in is $200. It takes three weeks to receive an order. Gold’s accountant, Irving Wu, recommends an annual cost of capital of 22 percent, a cost of shelf space of 3 percent of the value of the item, and a cost of 2 percent of the value for taxes and insurance.a. How many salamis should Gold have flown in and how often should he order them?b. How many salamis should Gold have on hand when he phones his brother to send another shipment?c. Suppose that the salamis sell for $3 each. Are these salamis a profitable item for Gold? If so, what annual profit can he expect to realize from this item? (Assume that he operates the system optimally.)d. If the salamis…
A company manufactures 5,000 units of a product per month. The cost of placing an order is Rs. 100. The purchase price of the raw material is Rs. 10 per kg. The re-order period is 4 to 8 weeks. The consumption of raw materials varies from 100 kg to 450 kg per week, the average consumption being 275 kg The carrying cost of inventory is 20% per annum. You are required to calculate- (a) Re-order Quantity (b) Re order Level (c) Maximum Level (d) Minimum Level le) Average Stock Level
Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 112, 500 units per year, an ordering cost of $3 per order, and carrying costs of $1.20 per unit. a. What is the economic ordering quantity? b. How many orders will be placed during the year? c. What will the average inventory be? d. What is the total cost of ordering and carrying inventory?
c) Dtee operates a small novelty shop. Each morning she purchases a small quantity of daily computerized horoscopes at a cost of R15.00 per item. She resells them later in the day for R25.00 per horoscope. For the past 200 days, Dtee's demand has been 6 items on 60 days, 7 items on 60 days, 8 items on 40 days, 9 items on 20 days and 10 items on 20 days. The horoscopes come in packages of 2, which forces Dtee to purchase an even number, and the horoscopes are saleable for one day only. At the end of each working day, however, Dtee can sell any remaining horoscopes to a night-town peddler for R10.00 per item. Set up the pay-off matrix for this problem.

SEE MORE QUESTIONS

Recommended textbooks for you

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Business in Action

Operations Management

ISBN:

9780135198100

Author:

BOVEE

Publisher:

PEARSON CO

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

Production and Operations Analysis, Seventh Editi…

Operations Management

ISBN:

9781478623069

Author:

Steven Nahmias, Tava Lennon Olsen

Publisher:

Waveland Press, Inc.

SEE MORE TEXTBOOKS