Question: A. The average time between orders is ___ weeks (Round to 2 decimal places). B. To provide a 99% cycle-service level, the safety stock for

A. The average time between orders is ___ weeks (Round to 2 decimal places).
B. To provide a 99% cycle-service level, the safety stock for this item is ___ units (Round to nearest whole number).
C. To provide a 99% cycle-service level, the reorder point for this item is ___ units (Round to nearest whole number).
D. For these policies, the annual cost of holding the cycle inventory is $____ (Round to 2 decimal places), and annual cost of placing orders is $___ (Round to 2 decimal places).
Your firm uses a continuous review system and operates 52 weeks per year. One of the SKUs has the following characteristics. Refer to the standard normal table for z-values. > Demand (D) = 18,000 units/year > Ordering cost (S) = $35.00/order > Holding cost (H) = $4.25/unit/year > Lead time (L) = 1 week(s) > Cycle-service level = 99% > Demand is normally distributed, with a standard deviation of weekly demand of 90 units. > Current on-hand inventory is 1,040 units, with no scheduled receipts and no backorders. The item's economic order quantity is 544 units. (Enter your response rounded to the nearest whole number.)Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
