The stationary shop estimates that the average demand for a popular ball-point pen is 12,000pens per week with a standard deviation of 3,000 pens. The current inventory policy calls forreplenishment orders of 156,000 pens. The average lead time from the distributor is 5 weeks,with a standard deviation of 2 weeks. If management wants a 98 percent cycle-service level,what should the safety stock be?41,118 pens51,806 pens101,118 pens51,086 pens

In this situation, I will determine the safety stock,

Answered: The stationary shop estimates that the…

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...

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First Printing has contracts with legal firms in San Francisco to copy their court documents. Daily demand is almost constant at 11,100 pages of documents. The lead time for paper delivery is normally distributed with a mean of 1 day and a standard deviation of 1 day. A 95% service level is expected. Compute First's ROP. Refer to the standard normal table for z-values. The reorder point is documents (round your response to the nearest whole number). Z-Table Z 0.38 0.50 0.67 0.84 1.04 1.28 1.41 1.56 1.65 1.75 1.88 2.06 2.33 Print Pr(Z) 65 69 75 80 85 90 92 94 95 96 97 98 99 Done - X
The Xenopeltis Company estimates its requirement, which is 39,000 units semiannually at a price of $4 per unit. The carrying cost at 15% of the price and its ordering cost at $90 per order. On a 360-day basis, determine the annual requirement
Based on available information, lead time demandfor PC jump drives averages 50 units (normally distributed),with a standard deviation of 5 drives. Management wants a97% service level.a) What value of Z should be applied?b) How many drives should be carried as safety stock?c) What is the appropriate reorder point?
A National chain of type fitters stocks a popular type for which the following information is available. The company operates on 50-week year and Normally operates from Monday to Friday only. Average usage 140 types per day Minimum usage 90 types per day Maximum usage 175 types per day Lead time 10 to 16 days Reorder quality 3000 Cost per types n$1500 Holding cost per unit 3% of unit cost Ordering cost per year n$75.50 Calculate the ordinary coat based on the current reorder quantity?
Fresco Inc. manufactures sour pops annually which requires 0.4 kilograms of raw material. The company produces and sells 1,600, 000 sour pops annually. The cost to place a single order is $60 per hour which takes four (4) hours on average. The annual carrying cost of inventory is 4% per annum and currently, the company orders twenty (20) times per year. A major supplier has offered some incentives for bulk purchases and as the junior cost accountant you were asked to provide your professional opinion on the optimal order size. A 3% discount would be given if the entity doubles its current lot size. A further 2% would be given if the entity increased its order by two and a half times the current lot size. The material is currently bought from its supplier for $120 per kilogram. Required: (a) Calculate the Economic Order Quantity (EOQ). (b) Calculate the total cost based on the EOQ. (c) Calculate the total cost for each alternate order quantities, including the current policy. (d) What…
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Regional Supermarket is open 360 days per year. Daily use of cash register tape averages 10 rolls. Usage appears normally distributed with a standard deviation of 2 rolls per day. The cost of order-ing tape is $1, and carrying costs are 40 cents per roll a year. Lead time is three days. a. What is the EOQ?b. What ROP will provide a lead time service level of 96 percent?
7. Sam's Cat Hotel operates 52 weeks per year, 5 days per week, and uses a continuous review inventory system. It purchases kitty litter for $11.00 per bag. The following information is available about these bags. Refer to the standard normal table for z-values. ≻Demand = 95 bags/week ≻Order cost = $57/order ≻Annual holding cost = 30 percent of cost ≻Desired cycle-service level=98 percent ≻Lead time = 1 week(s) (5 working days) ≻Standard deviation of weekly demand = 20 bags ≻Current on-hand inventory is 350 bags, with no open orders or backorders. a. What is the EOQ? (Enter your response rounded to the nearest whole number.) and (Enter your response rounded to one decimal place.) b. What should R be? (Enter your response rounded to the nearest whole number.) c. An inventory withdrawal of 10 bags was just made. Is it time to reorder? (is or is not)

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