Kameko Ltd. Manufactures a product branded T. The product has a constant monthly demand of 8,000 units.
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Question:
Kameko Ltd. Manufactures a product branded T. The product has a constant monthly demand of 8,000 units. The manufacture of the product requires a component which is purchased from a supplier at sh. 20 per unit. A lead time of four days is required from the date of order to the component. Ordering cost is sh. 60 per order while the holding cost is 10% per annum.
Required:
i) The total ordering and holding costs of the component per annum.
ii) Compute number of orders.
iii) A discount of 2% is offered on purchase of 7,000 units. Advice the company on optimal quantity to purchase.
Related Book For
Probability and Statistics for Engineering and the Sciences
ISBN: 978-1305251809
9th edition
Authors: Jay L. Devore
Posted Date: