Lee Company has a plant in Singapore that manufactures Mobile phones. One of the component required...

 

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Lee Company has a plant in Singapore that manufactures Mobile phones. One of the component required for this production is an XT micro-chip which is available from a number of Suppliers. The following information was compiled by the company's cost accountant: Expected demand in January 2018 for the micro-chips is 5,200 with ordering costs of $250 per order and monthly carrying cost of $5 per unit. 1) What is the economic order quantity for the chip in January? How many deliveries will be made in the month? 2) 3) What are the relevant cost factors that Lee Company will have to consider? 4) When should Lee order each quantity required and how should such a decision be made? 5) What should Lee Co. do to ensure that production of its mobile phones and any other product it manufactures is not adversely affected by external factors 6) How should the company organize itself in order to ensure that its inventories produce maximum profits Lee Company has a plant in Singapore that manufactures Mobile phones. One of the component required for this production is an XT micro-chip which is available from a number of Suppliers. The following information was compiled by the company's cost accountant: Expected demand in January 2018 for the micro-chips is 5,200 with ordering costs of $250 per order and monthly carrying cost of $5 per unit. 1) What is the economic order quantity for the chip in January? How many deliveries will be made in the month? 2) 3) What are the relevant cost factors that Lee Company will have to consider? 4) When should Lee order each quantity required and how should such a decision be made? 5) What should Lee Co. do to ensure that production of its mobile phones and any other product it manufactures is not adversely affected by external factors 6) How should the company organize itself in order to ensure that its inventories produce maximum profits

Answer rating: 100% (QA)

1 EOQ 2DCOCc CO Ordering Cost per order D Demand per annum Cc Carrying cost per item per annum D 520... View the full answer