Battery Wholesale, Inc. purchases batteries for $14 each, and it costs $11 to process an order....
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Battery Wholesale, Inc. purchases batteries for $14 each, and it costs $11 to process an order. The company sells about 12,000 of a particular type of battery per year at a uniform rate. The company is open 5 days a week for 52 weeks per year with the exception of six holidays a year. The order lead time is 3 days, and the company wants to have an average of 2 days' sales on hand as safety stock when a new order is scheduled to arrive. The holding cost is estimated to be 24 percent of the item cost per year. a. Determine the EOQ. b. Determine the expected level of the maximum inventory Battery Wholesale, Inc. purchases batteries for $14 each, and it costs $11 to process an order. The company sells about 12,000 of a particular type of battery per year at a uniform rate. The company is open 5 days a week for 52 weeks per year with the exception of six holidays a year. The order lead time is 3 days, and the company wants to have an average of 2 days' sales on hand as safety stock when a new order is scheduled to arrive. The holding cost is estimated to be 24 percent of the item cost per year. a. Determine the EOQ. b. Determine the expected level of the maximum inventory
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Related Book For
Operations Management in the Supply Chain Decisions and Cases
ISBN: 978-0073525242
6th edition
Authors: Roger Schroeder, M. Johnny Rungtusanatham, Susan Goldstein
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