ESTRELLA is a bike retailer located in the outskirts of Bacolod City. ESTRELLA purchases bikes from STORAGEHUB in orders of 250 bikes which is the current economic order quantity. STORAGEHUB is now offering the following bulk discounts to its customers: Price 0% discount on orders less than 499 P3,500 10% discount on orders above 500 units - 999 3,150 15% discount on orders above 1,000 units 2,975 ESTRELLA is wondering if the EOQ model is still the most economical and whether increasing the order size would actually be more beneficial. Following information is relevant to forming the decision: Annual demand is 5000 units Ordering cost is $100 per order Annual holding cost is 25% QTY SETUP HOLDING PROODUCT COST TOTAL COST Q1 25423.73 25812.5 what is the product cost what is the total cost Q2 3000 198437.5 what is the product cost what is the total cost Q3 1500 371875 what is the product cost what is the total cost
ESTRELLA is a bike retailer located in the outskirts of Bacolod City. ESTRELLA purchases bikes from STORAGEHUB in orders of 250 bikes which is the current economic order quantity. STORAGEHUB is now offering the following bulk discounts to its customers: Price 0% discount on orders less than 499 P3,500 10% discount on orders above 500 units - 999 3,150 15% discount on orders above 1,000 units 2,975 ESTRELLA is wondering if the EOQ model is still the most economical and whether increasing the order size would actually be more beneficial. Following information is relevant to forming the decision: Annual demand is 5000 units Ordering cost is $100 per order Annual holding cost is 25% QTY SETUP HOLDING PROODUCT COST TOTAL COST Q1 25423.73 25812.5 what is the product cost what is the total cost Q2 3000 198437.5 what is the product cost what is the total cost Q3 1500 371875 what is the product cost what is the total cost
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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ESTRELLA is a bike retailer located in the outskirts of Bacolod City. ESTRELLA purchases bikes from STORAGEHUB in orders of 250 bikes which is the current economic order quantity. STORAGEHUB is now offering the following bulk discounts to its customers: Price
- 0% discount on orders less than 499 P3,500
- 10% discount on orders above 500 units - 999 3,150
- 15% discount on orders above 1,000 units 2,975
ESTRELLA is wondering if the EOQ model is still the most economical and whether increasing the order size would actually be more beneficial. Following information is relevant to forming the decision:
- Annual demand is 5000 units
- Ordering cost is $100 per order
- Annual holding cost is 25%
QTY | SETUP | HOLDING | PROODUCT COST | TOTAL COST | |
Q1 | 25423.73 | 25812.5 | what is the product cost | what is the total cost | |
Q2 | 3000 | 198437.5 | what is the product cost | what is the total cost | |
Q3 | 1500 | 371875 | what is the product cost | what is the total cost |
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