Question: Why might it be inappropriate to use inventory turnover ratios
Why might it be inappropriate to use inventory turnover ratios to compare inventory performance of companies that are in different industries?
Relevant Questionsa. List the major assumptions of the EOQ model. b. How would you respond to the criticism that EOQ models tend to provide misleading results because values of D, S, and H are, at best, educated guesses? 1. What trade- offs are involved in each of these aspects of inventory management? a. Buying additional amounts to take advantage of quantity discounts. b. Treating holding cost as a percentage of unit price instead of as a ...A bakery buys flour in 25- pound bags. The bakery uses 1,215 bags a year. Ordering cost is $ 10 per order. Annual carrying cost is $ 75 per bag. a. Determine the economic order quantity. b. What is the average number of bags ...A company is about to begin production of a new product. The manager of the department that will produce one of the components for the product wants to know how often the machine used to produce the item will be available ...Given this information: Lead- time demand 600 pounds Standard deviation of lead time demand 52 pounds (Assume normality.) Acceptable stockout risk during lead time 4 percent a. What amount of safety stock is appropriate? b. ...
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