hapter $12$ Homework: Managing Inventories in Supply Chains

Problem $12-44$ Algo $($Managing Fixed$-$Quantity Inventory Systems$)$

Question $2$ of $11$

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Brenda opened a pool and spa store in a lively shopping mall and finds business to be booming but she often stocks out of key items customers want. Super Algaecide $($SA$)$ is a high margin SKU, but it stocks out frequently. Brenda orders boxes from a vendor $160$ miles away. Brenda is busy running the store and seldom has time to review store inventory status and order the right quantity at the right time. She collected the following data:

Demand $=10$ boxes per week Store open $=48$ week$\frac{s}{y}$ear

Order cost $=$$$\frac{45}{o}$rder Lead$-$time $=4$ weeks

Item cost $=$$$\frac{90}{b}oxStd.$ deviation $in$ weekly demand $=5$

Inventory$-$holding cost $=20$ percent per year Service level $=93$ percent

Brenda wants to consider setting up a fixed$-$period inventory system for the $28-$ounce bottle of Super Algaecide $($SA$)$ SKU. At the beginning of the current week, D$.$ J$.$ Kole, the materials manager, checked the inventory level and found $55$ units on$-$hand. There were no scheduled receipts and $30$ units were on backorder.

a$.$ What is the review period $(T)?$ Do not round intermediate calculations. Round your answer up to the nearest whole number.

weeks

b$.$ What is stock replenishment level with safety stock $(M)?$ Do not round intermediate calculations. Round your answer to the nearest whole number.

bottles

c$.$ How many units should be ordered? Do not round intermediate calculations. Round your answer to the nearest whole number.

orders$/$year

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Partially Correct

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