Note: I got this answer from the site..but I want to add and modify the answers..especially for the third question..I want to modify the answers and change some of the words with the addition. I hope you can help me with that.. and thank you very much

1. On following Therese' method,

Total demand=300*12=3600

No. of orders=4

total ordering cost= no. of orders*ordering cost=4*10.5=BD42

average inventory=Q/2=900/2=450

Total holding cost=average inventory*unit holdinh cost=450*2.5=BD1125

Total cost price of units ordered=Total demand*unit cost price=3600*0.15=BD540

Total cost=total ordering cost+ Total holding cost+ Total cost price=42+1125+540=BD1707

On following Ulah's method,

Total demand, D=300*12=3600

Ordering cost, S=BD10.5

unit holding cost, h=BD2.5

EOQ=sqrt(2*D*S/h)=sqrt(2*3600*10.5/2.5)=173.89=174 units

No. of orders=3600/174=20.7=21

total ordering cost= no. of orders*ordering cost=21*10.5=BD220.5

average inventory=Q/2=174/2=87

Total holding cost=average inventory*unit holdinh cost=87*2.5=BD217.5

Total cost price of units ordered=Total demand*unit cost price=3600*0.15=BD540

Total cost=total ordering cost+ Total holding cost+ Total cost price=220.5+217.5+540=BD978

Cost savings=1707-978=729

2. No. of orders is higher in Ulah's case. We will order 21 times using Ulah's method while we will order only times using Therese' method.

Frequency of ordering is higher using Ulah's method.

Total ordering cost is lesser in Therese' method (BD42) and much higher in Ulah's method (BD220.5).

Total holding cost is lesser in Ulah's method (BD217.) and much higher in Therese' method (BD1125).

However, if we compare total costs, Ulah's method is cheaper for the company.

3. I will approah Ulah's method as it leads to subatantial cost savings amounting to BD729 when compared to Therese' method.

Note: I got this answer from the site..but I want to add and modify the answers..especially for the third question..I want to modify the answers and change some of the words with the addition. I hope you can help me with that.. and thank you very much

Case study: Keto Food is having its operations meeting sometime next time. Keto Foods is a shop/restaurant that cater to people who are on diet by preparing their meal according to the required calaries to attain a particular weight. Ms Therese is the manager of this shop/restaurant and takes charge also of the supplies and raw materials. As per practice, Ms Therese will follow the usual ordering style of its previous manager which is monthly, they will need 300 food boxes whose price is BD 0.150. They continue to order 4x in a year with a quantity of 900 boxes per order. The cost of ordering from supplier is Bd 10.50 while the cost to keep the boxes in good condition is BD 2.5. Few managers have came and gone but this practice have not been checked and validated. On its operations meeting, Ms Therese still declares that practice is saving money for the company. Just before the operations meeting, a trainee named Ms. Ulah has come and has been instructed to introduce improvements in operations, Ms. Ulah, who is a graduating student of MS Manufacturing Management saw that there is something wrong with the practice. She objects the practice that is being done by Ms Therese when it comes to ordering the food boxes. Ms. Ulah is suggesting to use the economic order quantity as per inventory model to reduce the cost. Answer the following Questions. 1. How can you prove that Ms Therese is doing it wrongly? Present the figures in terms of total cost and savings (C8)=10 pts 2. Compare the approaches that are being followed by Ms Therese and the proposed way of Ms Ulah by presenting data like no. of orders and frequency of order ( C8) 9 pts 3. If you are tasked to attend the operations mtg, whose approach will you endorse and how can you support you stand? ( C4 ) 6 pts