A coffee franchise owner opened a local coffee shop, called MUG, in one of the suburbs...
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A coffee franchise owner opened a local coffee shop, called MUG, in one of the suburbs of New York City. The coffee shop estimates it uses 3,000 pounds of coffee annually. The manager of MUG has to determine how many pounds to order each time in order to minimize the total annual inventory cost of the store. a. Determine the optimal order size for MUG assuming an EOQ model with a holding cost of $10 per pound annually and an ordering cost of $100. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Optimal Q b. The coffee franchise owner has recently opened a second coffee shop of the same size, called GRIND. The demand for coffee in the second store is 3,800 pounds annually, with a higher holding cost of $60 per pound (ordering cost for GRIND is the same as it was for MUG). The franchise owner advised the manager of GRIND to place orders of the same size as his first store because the two coffee shops can seat the same amount of people. How much will the total annual inventory cost be for this second coffee shop? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total cost will be c. Can the manager of the second coffee shop, GRIND, save money by changing the order size for its coffee shop? O Yes O No if the order size is the same in both shops. What is the optimal order size for the second coffee shop, GRIND? What is the total annual inventory cost for this second coffee shop if it uses this new optimal order size? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Optimal Q for NYC coffeeshop Total cost How much money will this alternative order quantity save the second store compared to the plan of just ordering the same amount as they did for the first store? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Amount saved A coffee franchise owner opened a local coffee shop, called MUG, in one of the suburbs of New York City. The coffee shop estimates it uses 3,000 pounds of coffee annually. The manager of MUG has to determine how many pounds to order each time in order to minimize the total annual inventory cost of the store. a. Determine the optimal order size for MUG assuming an EOQ model with a holding cost of $10 per pound annually and an ordering cost of $100. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Optimal Q b. The coffee franchise owner has recently opened a second coffee shop of the same size, called GRIND. The demand for coffee in the second store is 3,800 pounds annually, with a higher holding cost of $60 per pound (ordering cost for GRIND is the same as it was for MUG). The franchise owner advised the manager of GRIND to place orders of the same size as his first store because the two coffee shops can seat the same amount of people. How much will the total annual inventory cost be for this second coffee shop? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Total cost will be c. Can the manager of the second coffee shop, GRIND, save money by changing the order size for its coffee shop? O Yes O No if the order size is the same in both shops. What is the optimal order size for the second coffee shop, GRIND? What is the total annual inventory cost for this second coffee shop if it uses this new optimal order size? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Optimal Q for NYC coffeeshop Total cost How much money will this alternative order quantity save the second store compared to the plan of just ordering the same amount as they did for the first store? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Amount saved
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a To determine the optimal order size EOQ for MUG EOQ 2 Annual Demand Ordering Cost Holding Cost EOQ ... View the full answer
Related Book For
South-Western Federal Taxation 2020 Comprehensive
ISBN: 9780357109144
43rd Edition
Authors: David M. Maloney, William A. Raabe, James C. Young, Annette Nellen, William H. Hoffman
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