Q.3.1 Gill Enterprises produces a number of consumer items, including a stove. A key component of the stove is purchased from an outside supplier. In total, the company purchases 2 500 components each year. It costs approximately R12 to place an order and it costs R0.25 to carry one part in inventory for a year. The company is operational for 50 weeks in a year. Required: Q.3.1.1 Calculate the economic order quantity for the part.

Practical Management Science
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ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Q.3.1
Gill Enterprises produces a number of consumer items, including a stove. A key
component of the stove is purchased from an outside supplier. In total, the company
purchases 2 500 components each year. It costs approximately R12 to place an order
and it costs R0.25 to carry one part in inventory for a year. The company is
operational for 50 weeks in a year.
Required:
Q.3.1.1 Calculate the economic order quantity for the part.
Transcribed Image Text:Q.3.1 Gill Enterprises produces a number of consumer items, including a stove. A key component of the stove is purchased from an outside supplier. In total, the company purchases 2 500 components each year. It costs approximately R12 to place an order and it costs R0.25 to carry one part in inventory for a year. The company is operational for 50 weeks in a year. Required: Q.3.1.1 Calculate the economic order quantity for the part.
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