Chapter 9 Sam's Cat Hotel operates 52 weeks per year and uses a continuous review inventory system It purchases kitty litter for $10 4 per bag The following information is available about these bags Demand 80 bags week Order cost $52 order Annual holding cost 26 of cost per bag Desired cycle service level 90 Lead time 3 weeks Standard deviation of weekly demand 15 bags Assume that the firm decides to change to the periodic review system to control the inventory for kitty litter The time between reviews, P , is the average time between orders as calculated in part b What should be the target inventory level T

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Question: Chapter 9: Sam's Cat Hotel operates 52 weeks per year and uses a continuous review inventory system. It purchases kitty litter for $10.4 per bag.

Chapter 9: Sam's Cat Hotel operates 52 weeks per year and uses a continuous review inventory system. It purchases kitty litter for $10.4 per bag. The following information is available about these bags.

Demand = 80 bags/week
Order cost = $52/order
Annual holding cost = 26% of cost per bag
Desired cycle-service level = 90%
Lead-time = 3 weeks
Standard deviation of weekly demand = 15 bags

Assume that the firm decides to change to the periodic review system to control the inventory for kitty litter. The time between reviews, P, is the average time between orders as calculated in part b. What should be the target inventory level T?

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