A bakery buys flour in 25- pound bags. The bakery uses 1,215 bags a year. Ordering cost

Question:

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 on hand?

c. How many orders per year will there be?

d. Compute the total cost of ordering and carrying flour.

e. If holding costs were to increase by $ 9 per year, how much would that affect the minimum total annual cost?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Operations Management

ISBN: 978-0078024108

12th edition

Authors: William J Stevenson

See More Books

Question Posted: Dec 30, 2014 07:01 AM

See More Questions

A large bakery buys flour in 25 kg bags. The bakery uses an average of 4,860 bags a year. Preparing an order and receiving the shipment of flour bags involves a cost of $ 10 per order. Annual holding...
If the level of government spending were to increase by 50 units in the IS-LM schedule model, how would this affect the position of the IS schedule? In which direction would the schedule shift and by...
What is the average number of bookings for each hotel in August?
.How dependent do you think the success of zero-based budgeting would be on the types of attribution models used? How might you increase the odds of success in this budgeting approach? .Advertising,...
Assume the required reserve ratio on all deposit liabilities is 15%. Calculate the level of excess reserves for Sovereign Bank. How much can Sovereign Bank safely lend? Sovereign Bank Assets...
You are the chief information officer for a midsized organization that has decided to implement an ERP system. The CEO has met with a consulting ERP system. The CEO has met with a consulting ERP firm...
Young Blood Helps Old Brains Exercise 2.69 introduces a study in which old mice were randomly assigned to receive transfusions of blood from either young mice or old mice. Researchers then measured,...
The following preliminary unadjusted trial balance of Ranger Co., a sports ticket agency, does not balance: When the ledger and other records are reviewed, you discover the following: (1) the debits...
Briefly describe (a) a common criticism of utilitarianism, and (b) a possible response to that criticism, defending utilitarianism. Which side (the critic or the defender) do you think has the...
Traveller Bus Lines Inc. (TBL) is a wholly owned subsidiary of Canada Transport Enterprises Inc. (CTE). CTE is a publicly traded transportation and communications conglomerate. TBL is primarily in...
a. The following table contains figures on the monthly volume and unit costs for a random sample of 16 items from a list of 2,000 inventory items at a health care facility. Develop an A- B- C...
A large law firm uses an average of 40 boxes of copier paper a day. The firm operates 260 days a year. Storage and handling costs for the paper are $ 30 a year per box, and it costs approximately $...
Companies in the U.S. car rental market vary greatly in terms of the size of the fleet, the number of locations, and annual revenue. In 2011, Hertz had 320,000 cars in service and annual revenue of...
An electronic circuit is created to light a lamp. There are two buttons (named A and B) in the circuit, each of which can create a "short-to-ground" that will result in the lamp failing to light when...
Emily and Fran sliding: The forces acting on Emily are the force of gravity downwards, the normal force upwards, and the frictional force to the left. The forces acting on Fran are the force of...
The ventilation system for the classroom provides 15 m3/h per person, and there are 16 occupants in the classroom. The outdoor air is at 5C and 80% relative humidity and indoor air is at 22C and 50%...
A UCSD aerospace structures student pilot gets the opportunity to serve as a co-pilot on a 3-hour private experimental racing aircraft flight from San Diego to the National Championship Air Races in...
A car travels with a constant velocity of 20 mph (miles per hour) until 3:50:00 and then speeds up as shown on the graph below. The driver notices it takes 3 seconds to speed up from 20 mph to 50...
Suppose X Uniform(0, 1), and given X = x, Y Exponential ( = 1/2x). a. Find the linear MMSE estimate of X given Y . b. Find the MSE of this estimator. c. Check that E[XY ] = 0.
The landing gear of an aircraft with: mass of 2000 kg the spring-mass-damper system Consider that the runway surface is y(t) = 0.2 cos 157.08t stiffness of the spring is 5 x 105 N/m. What is the...
Raye believes the previous advisers asset class specifications for equity and derivatives are inappropriate given that, for purposes of asset allocation, asset classes should be: A. diversifying. B....
The tasks shown in the following precedence diagram are to be assigned to workstations with the intent of minimizing idle time. Management has designed an output rate of 275 units per day. Assume 440...
Develop simple process layouts.
Solve simple line-balancing problems.
Use the product process matrix to explain the proposal by management for market 2 for international frozen pizza company.
Write a paper detailing your ideal "Quality Improvement Team."
For this week's discussion question, assume you are a business analyst for an ocean/rail shipping container manufacturer that sells products in over 70 countries. Obviously, the forecast for...

A bakery buys flour in 25- pound bags. The bakery uses 1,215 bags a year. Ordering cost

Question:

Step by Step Answer:

Given D 1215 bags per year S 10 H 75 Round the value of ...View the full answer

Operations Management

Students also viewed these Management Leadership questions