2. Suppose that JJ Inc. supplies Honda with steering wheels to the CR-V, and that Honda...

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2. Suppose that JJ Inc. supplies Honda with steering wheels to the CR-V, and that Honda will regularly order their EOQ of 3,000 units. The annual demand for these steering wheels is 250,000 units. Honda's ordering cost per order is $45, and their annual holding cost per unit is $2.75. JJ has been producing in runs that are double Honda's EOQ, and they have a setup cost of $80 per order, with an annual holding cost per unit of $2.25. A. What is the current total cost for: i. (4 points) JJ Inc. ii. (4 points) Honda iii. (2 points) The Supply Channel B. (10 points) JJ Inc. is interested in cutting their costs and would like to coordinate with Honda. If the two supply chain partners were to coordinate how many units would Honda order? C. If the two supply chain partners coordinated, what would the new total cost be for: i. (4 points) JJ Inc. ii. (4 points) Honda iii. (2 points) The Supply Channel D. (4 points) What is the percent savings for the channel if the two companies were to coordinate their orders? E. (6 points) What would be the minimum amount (in dollars) of savings that JJ Inc. would need to kick back to Honda in order for Honda to agree to coordinate with them? If JJ Inc. paid that amount to Honda, how much savings would they have left over for themselves, if any? 2. Suppose that JJ Inc. supplies Honda with steering wheels to the CR-V, and that Honda will regularly order their EOQ of 3,000 units. The annual demand for these steering wheels is 250,000 units. Honda's ordering cost per order is $45, and their annual holding cost per unit is $2.75. JJ has been producing in runs that are double Honda's EOQ, and they have a setup cost of $80 per order, with an annual holding cost per unit of $2.25. A. What is the current total cost for: i. (4 points) JJ Inc. ii. (4 points) Honda iii. (2 points) The Supply Channel B. (10 points) JJ Inc. is interested in cutting their costs and would like to coordinate with Honda. If the two supply chain partners were to coordinate how many units would Honda order? C. If the two supply chain partners coordinated, what would the new total cost be for: i. (4 points) JJ Inc. ii. (4 points) Honda iii. (2 points) The Supply Channel D. (4 points) What is the percent savings for the channel if the two companies were to coordinate their orders? E. (6 points) What would be the minimum amount (in dollars) of savings that JJ Inc. would need to kick back to Honda in order for Honda to agree to coordinate with them? If JJ Inc. paid that amount to Honda, how much savings would they have left over for themselves, if any?

Answer rating: 100% (QA)

ANSWER A i JJ Incs current total cost Annual setup cost x Annual number of setups Annual holding cost per unit x Total number of units produced 2 Annu... View the full answer