4. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Note: Kindly input your answer with comma. Example: 10,000 Required: a. Compute the economic order quantity. b. How many orders would be placed under the EOQ policy? c. Compute the annual ordering cost for the EOQ.

4. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Note: Kindly input your answer with comma. Example: 10,000 Required: a. Compute the economic order quantity. b. How many orders would be placed under the EOQ policy? c. Compute the annual ordering cost for the EOQ.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 6E: Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The...

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Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The cost of placing an order is 30. The cost of holding one unit of inventory for one year is 15.00. Currently, Ottis places 160 orders of 4,000 plastic housing units per year. Required: 1. Compute the annual ordering cost. 2. Compute the annual carrying cost. 3. Compute the cost of Ottiss current inventory policy. Is this the minimum cost? Why or why not?
A. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Required: 1. Compute the economic order quantity. 2. How many orders would be placed under the EOQ policy? 3. Compute the annual ordering cost for the EOQ. 4. Compute the annual carrying cost for the EOQ. 5. Compute the total inventory-related cost at the EOQ. 6. Previously, the company had been purchasing 5,000 units of product X per order: What is the ordering cost per year under the previous policy? ii. The annual carrying cost? iii. How much money does the company save over the policy of purchasing 5,000 units per order using the EOQ policy? i. B. Kings Company presents the following information: 1. Annual credit sales: P 25,200,000 2. Collection period: 3 months 3. Rate of return: 12% Kings company considers changing its credit term from n/30 to 3/10, 1/30. The following are…
5. Genesis Company is a wholesaler. It purchases 60.000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Note: Kindly input your answer with comma. Example: 10,000 Required: Previously, the company had been purchasing 5,000 units of product X per order: a. What is the ordering cost per year under the previous policy? b. The annual carrying cost? c. How much money does the company save over the policy of purchasing 5,000 units per order using the EOQ policy?
Given: Peter Piper has projected sales of 72,000 pipes this year, ordering cost of P6 per order, and carrying costs of P2.40 per pipe. With the given data, can you give me the solution on how to get: -What is the economic ordering quantity? -Total inventory cost at EOQ -How many orders will be placed during the year?-What will the average inventory be? Thank you in advance.
A supplier sells MF Tires to dealers. The annual demand is approximately1,000 tires. The supplier pays P50 for each tire and estimates that the annualholding cost is 20 percent of the total value of tires. It costs approximatelyP25 to place an order. The supplier currently orders 80 tires per month.Required:a. Calculate ordering, holding, and total inventory costs for thecurrent ordered quantity.b. Determine the EOQ.c. How many orders will be placed per year using the EOQ?d. Calculate ordering, holding, and total inventory costs for the EOQand also determine the change in total inventory cost.
A6) Finance XYZ is a retailer and sells 179,000 units per year. It purchases from a single supplier. Fixed costs per order are $868 and carrying cost is $11 per unit. How many units should XYZ purchase per order? That is, what is the Economic Order Quantity? Enter your answer rounded off to two decimal points. Margin for error: +/- 1
A company is presently ordering on the basis of an EOQ. The demand is 10,000units a year, unit cost is $10, ordering cost is $30, and the cost of carrying inventoryis 20%. The supplier offers a discount of 3% on orders of 1000 units or more. Whatwill be the saving (loss) of accepting the discount?
The rate of consumption of an item is 20 units per year. The cost of procurement (i.e. placing an order and receiving the goods) per order is Rs. 40. The unit cost is Rs. 100. Inventory carrying cost is 0.16% and it depends upon the average stock. Use Model I to determine: (i) EOQ (ii) If lead time is 3 months, determine the reorder point.
An inventory item has a demand of 10,000 units per month. The cost of each unit is $6, and the interest on tied-up money is 10%. The average ordering cost is $250 per order. a) What is the EOQ? units (round your response to the nearest integer). b) What is the optimal number of orders per year? to the nearest integer) c) What is the optimal number of days between any two orders? your response to the nearest integer) d) What is the annual holding cost? $ nearest integer) orders (round your response e) What is the total annual cost of the inventory system? $ to the nearest integer) days (round per year (round your response to the (round your response
MM Co. expects total sales of P10,000. The price per unit is P5. The firm estimates an ordering cost of P7.50 per order, with an inventory cost of P0.70 per unit. What is the optimum order size? A. 147 units B. 207 units C. 327 units D. 463 units
2. Hamid Company consumes inventory of 100,000 units of components per year. The carrying cost per unit is RO 3.50. The fixed order cost is RO 20 per order. The production planning is 365-day year. The delivery time is three days. a. Calculate and interpret the Economic Order Quantity (EOQ). b. At what inventory level should Hamid Company place another order. Interpret.
You are asked to manage the purchases of potatoes (10 kgs per bag). The annual demand = 1200 bags, Deliveredpurchase cost = 30/bags, Annual carrying cost percentage= 10percent, Order cost = 50/order. The lead time is 5 working days. Assuming 24 working days per month. 5.1 Determine the Economic Order Quantity 5.2 Determine the reorder point 5.3 Determine the average inventory5.4 Suppose orders are placed only at review time. Find the optimal period and the optimal orderquantity.