Question: DECISION PROBLEM 2: Inventory Management Olde Worlds accessories department operates 48 weeks per year. The warehouse manager is attempting to optimize an inventory policy for

DECISION PROBLEM 2: Inventory Management Olde Worlds accessories department operates 48 weeks per year. The warehouse manager is attempting to optimize an inventory policy for one of its accessories (an automated sunscreen that rolls down when temperatures exceed 85 degrees) that it purchases from a 3 rd-party supplier. Use the following information to answer the questions below. Demand (D)=1500 units/year Demand is normally distributed Standard deviation of weekly demand =2 units Ordering cost = $50/order Annual holding cost (H)= $6/unit Desired cycle-service level =95% percent Lead time (L)=3 weeks A. If Olde World uses a periodic review system, what should the P and T be? Round P to the nearest week. B. If Olde World uses a continuous review system, what should R be? C. Which inventory review system would you recommend? Why?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!

Make an essay in brief on the below case study, Mention the issue face and the Recommendation on the below case study HALF CENTURY OF SUPPLY CHAIN MANAGEMENT AT WAL- MART 1 INTRODUCTION James...

Olde World Windows and Doors is a manufacturer of steel windows and doors for both residential and commercial applications. The following problems are decisions that senior management faces in...

Pacific Systems Elcom Sure Tech E-Drive Park Current Ratio 1.2 1.3 1.3 1.1 Inventory Turnover 5.2 5.4 9 7 Long-Term Debt Ratio to Assets 0.25 0.15 0.17 0.4 Receivable Days 49 29 59 40 Payable Days...

Compute these ratios for each of the last three years. Total Assets Turnover Ratio=sales (or operating) revenue/Average total assets Return on Assets= Net earnings+Interest expense(net of...

hi. I'm stuck with a report whose Chic Paints Ltd. and I am finding difficulty to answer some questions such as the organisations accounting system requirements including hardware and software...

Averell Cabinetry Case Overview This case is presented as close as possible to the way you may encounter it in working life. Your role is that of a newly hired HR manager. You will learn about the...

In the Intro to Purchasing and Supply Chain reading, Page 6, Figure 1-2, there is a comparison of Traditional Purchasing versus the Current Outlook. Provide three reasons why the Current Outlook is...

TANGLEWOOD CASEBOOK for use with STAFFING ORGANIZATIONS 7th Ed. Kammeyer-Mueller 1 TANGLEWOOD CASEBOOK To accompany Staffing Organizations, seventh edition, 2012. Prepared by John Kammeyer-Mueller...

Group: PERON A+ PERSON B +PERSON C 1- Introduction 2- Literature a. Definition of operation management b. Definition of operation strategy and why it is important c. Components of operations strategy...

A 170X astronomical telescope is adjusted for a relaxed eye when the two lenses are 1.25 m apart. What is the focal length of each lens?

Hydrogen, H2, is used as a rocket fuel. The hydrogen is burned in oxygen to produce water vapor. 2H2(g) + O2(g) 2H2O(g); H = 484 kJ What is the enthalpy change per gram of hydrogen?

to calculate current assets you take total current assets then subtract

In Medical Sociology, we see that African-American males tend to live somewhat shorter lives than their male counterparts in various races. Based on researchers, what are some factors that may...