The annual demand for a certain product is 1500 units. The costs of placing an order...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The annual demand for a certain product is 1500 units. The costs of placing an order are estimated to be OMR 45 per order and the annual carrying cost is 20% of the cost of the item. The cost varies depending on the quantity ordered each time. The number of working days in a year is 280. a) b) c) d) Order Quantity 1 to 199 200 to 299 300 or more Cost per item 18 17 16.5 What is the optimal order quantity the company should use each time it places an order, so as to minimize the total cost. What is the length of order cycle (time between orders) using the optimal order quantity computed in part (a). The company is currently following a policy of ordering once at the beginning of each month. How much is the company losing every year due to this policy? If the lead time is 20 days, what is the reorder point? The annual demand for a certain product is 1500 units. The costs of placing an order are estimated to be OMR 45 per order and the annual carrying cost is 20% of the cost of the item. The cost varies depending on the quantity ordered each time. The number of working days in a year is 280. a) b) c) d) Order Quantity 1 to 199 200 to 299 300 or more Cost per item 18 17 16.5 What is the optimal order quantity the company should use each time it places an order, so as to minimize the total cost. What is the length of order cycle (time between orders) using the optimal order quantity computed in part (a). The company is currently following a policy of ordering once at the beginning of each month. How much is the company losing every year due to this policy? If the lead time is 20 days, what is the reorder point?
Expert Answer:
Related Book For
Posted Date:
Students also viewed these general management questions
-
2)A graphical plot with sales on the Y axis and time on the X axisis a A)Scatter diagram. B)Trend projection. C)Radar chart. D)Line graph. E)Bar chart. 5)Assume that you have tried three different...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
The annual demand for a famous speaker component for small stereo systems is 40,000. Jalen Mathis estimates that the ordering cost is $15 per order. Furthermore, the carrying cost is estimated to b...
-
Assume C is a circle centered at the origin, oriented counterclockwise, that encloses disk R in the plane. Complete the following steps for the vector field F = (9y, - 2x). a. Calculate the...
-
Explain why you agree or disagree with your results? Develop strategies to advance your career using your strength.
-
The following kinetic data are collected for the initial rates of a reaction 2X + Z products: (a) What is the rate law for this reaction? (b) What is the value of the rate constant with proper...
-
Which of the following capital-budgeting decision rules is the best choice for selecting projects if used alone? a. Discounted payback b. IRR c. MIRR d. NPV
-
Should DeWolfe and Anderson have given up so much equity (66%) in the beginning to eUniverse? Was there an alternative strategy available?
-
1.6 If the mean annual runoff of a drainage basin of 10,000 km is 140 m, and the average an- nual precipitation is 105 cm, estimate the ET losses for the area in 1 year. What are your assumptions?...
-
Northern Products reported the following amounts in its 2022 financial statements. The 2021 amounts are given for comparison. Requirements 1. Compute Northerns quick (acid-test) ratio at the end of...
-
Milestone Two Guidelines and Rubric Overview: For the final project, you will use this case study to prepare a financial analysis report for Home Depot Inc. You will include in your analysis the...
-
A group of divers is exploring an old sunken ship. Suppose the null hypothesis, H0, is: the sunken ship does not contain buried treasure. State the Type I and Type II errors in complete sentences.
-
What is the purpose of diluted EPS?
-
When are the costs of enhanced pension entitlements associated with termination packages included in income?
-
Assume that a company has two classes of shares that both have voting rights and are entitled to the proceeds of net assets on dissolution. One class is entitled to receive 10 times the dividends of...
-
When are gains and losses related to pension plan settlements and curtailments recognized?
-
Chris Spear invested $14,000 today in a fund that earns 8% compounded annually. Click here to view factor tables To what amount will the investment grow in 2 years? To what amount would the invest...
-
For Problem estimate the change in y for the given change in x. y = f(x), f'(12) = 30, x increases from 12 to 12.2
-
Cubsville Manufacturing has a cycle time of less than a day, uses a raw and in process (RIP) account, and expenses all conversion costs to Cost of Goods Sold. At the end of each month, all...
-
What is a budget and how is it related to the control function?
-
Regarding levels of raw materials and work in process inventories, what is the purpose of a JIT inventory system?
-
Show that the market portfolio must be on the capital market line and on the portion of the curve called the efficient frontier (see Section 21.2).
-
Why does this chapter provide an explanation of the development of mutual funds?
-
What conditions are necessary for a risk-free asset to be free of risk? Provide an example. Is it really risk-free?
Study smarter with the SolutionInn App