PassTheHoney imports honeycombs from Turkey to sell convenient honeycomb snacks. They have two stores, one in...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
PassTheHoney imports honeycombs from Turkey to sell convenient honeycomb snacks. They have two stores, one in San Diego and one in LA. In both cities, the weekly demands are very similar and remarkably stable over time without uncertainty. Each week, Pass TheHoney has been selling 2000 boxes of honeycombs in each city. One year is 52 weeks. Each store orders separately from their supplier in Turkey. In both stores, PassTheHoney sells one box of honeycombs at $20 to customers, whereas the cost of one box of honeycombs is $4. When placing an order to their supplier in Turkey, the fixed cost of shipping regardless of the order size is $1500. The annual cost of capital for Pass TheHoney is 15%. (i) For the store in San Diego, what is the optimal order size for each order? What is the annual shipping cost for the San Diego store? (5 points) (ii) Now, Pass TheHoney integrates two stores into one and places orders for the integrated store. What is the optimal order size for the integrated store? What is the annual inventory holding cost for the integrated store? (5 points) (iii) What is the average ow time of honeycombs in the San Diego store in part (1)? What is the average flow time of honeycombs in the integrated store in part (ii)? Which one moves honeycombs through the store faster? (5 points) PassTheHoney imports honeycombs from Turkey to sell convenient honeycomb snacks. They have two stores, one in San Diego and one in LA. In both cities, the weekly demands are very similar and remarkably stable over time without uncertainty. Each week, Pass TheHoney has been selling 2000 boxes of honeycombs in each city. One year is 52 weeks. Each store orders separately from their supplier in Turkey. In both stores, PassTheHoney sells one box of honeycombs at $20 to customers, whereas the cost of one box of honeycombs is $4. When placing an order to their supplier in Turkey, the fixed cost of shipping regardless of the order size is $1500. The annual cost of capital for Pass TheHoney is 15%. (i) For the store in San Diego, what is the optimal order size for each order? What is the annual shipping cost for the San Diego store? (5 points) (ii) Now, Pass TheHoney integrates two stores into one and places orders for the integrated store. What is the optimal order size for the integrated store? What is the annual inventory holding cost for the integrated store? (5 points) (iii) What is the average ow time of honeycombs in the San Diego store in part (1)? What is the average flow time of honeycombs in the integrated store in part (ii)? Which one moves honeycombs through the store faster? (5 points)
Expert Answer:
Answer rating: 100% (QA)
PassTheHoney Inventory Optimization Part i San Diego Store 1 Optimal Order Quantity EOQ Weekly deman... View the full answer
Related Book For
Principles of Auditing and Other Assurance Services
ISBN: 978-0078025617
19th edition
Authors: Ray Whittington, Kurt Pany
Posted Date:
Students also viewed these business writing questions
-
What is the average compounded annual dividend growth rate over the 5-year period from 2016 to 2021 for a firm who paid a dividend of $1.70 in year 2016 and increased its dividend somewhat steadily...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
Three disease-carrying organisms decay exponentially in lake water according to the following model: Estimate the initial population of each organism (A, B, and C) given the followingmeasurements:...
-
Werstiner Corporation is preparing its cash flow statement by the indirect method. The company has the following items for you to consider in preparing the statement. Identify each item as Operating...
-
Evaluate each of the following expressions to six-figure accuracy. (1 + 0.055) 1 / 6 1
-
Do the needs for and uses of internal and consolidated ecological accounting differ? If so, how? Are the two related?
-
Solar Energy Corp. has $4 million in earnings with four million shares outstanding. Investment bankers think the stock can justify a P/E ratio of 21. Assume the underwriting spread is 5 percent. What...
-
Describe various methods of payments for international trade. Give some examples. please explain thoroughly.
-
Hemming Company reported the following current-year purchases and sales for its only product. Date Activities January 11 Beginning inventory. January 10 Sales March 14 March 151 July 30 October 5...
-
Given The Euler Phi Function (5p)=4(p-1) where p is prime, use Euler's Theorem with a suitable value of p To find The remainder of 5103 when divided by 14. So, we must find 5103 (mod 14)?
-
Which of the following news items involves a short-run decision and which involves a long-run decision? Explain. January 31, 2008: Starbucks will open 75 more stores abroad than originally predicted,...
-
Lees accountant recorded the depreciation on his cottage during 2010 as $7,000. According to the accountant, what profit did Lee make? Lee is a computer programmer who earned $35,000 in 2009. But on...
-
Under IFRS, unrealized gains on non-trading stock investments should: (a) be reported as other revenues and gains in the income statement as part of net income. (b) be reported as other gains on the...
-
Under IFRS, at the end of the first year of operations, the total cost of the trading investments portfolio is $120,000. Total fair value is $115,000. The financial statement should show: (a) a...
-
The Wellstone Division operates as a profit center. It reports the following for the year. Budget Actual Sales $2,000,000 $1,860,000 Variable costs 800,000 760,000 Controllable fixed costs 550,000...
-
Which of these is NOT a function of the layer at D? 4/416 to insulate the body from heat loss to supply cells to replace those lost from the epidermis to store energy to loosely connect the skin to...
-
On August 31, 2012, the balances of the accounts appearing in the ledger of Wood Interiors Company, a furniture wholesaler, are as follows:Prepare the August 31, 2012, closing entries for Wood...
-
You are the Partner-in-Charge of a large metropolitan office of a regional public accounting firm. Two members of your professional staff have come to you to discuss problems that may affect the...
-
What board establishes international ethical standards for accountants? How do these standards compare to the AICPA Code of Professional Conduct?
-
Comment on the following:any voided prenumbered shipping documents should be properly canceled and disposed of to eliminate any possibility of improper shipment of goods.
-
The following data are taken from the comparative balance sheets of Girard Billiards Club, which prepares its financial statements using the accrual basis of accounting. Fees are billed to members...
-
Colin Mochrie Company has the following balances in selected accounts on December 31, 2008. All the accounts have normal balances. Colin Mochrie Company debits prepayments to expense accounts when...
-
Tony Masasi started his own consulting firm, Masasi Company, on June 1, 2008. The trial balance at June 30 is shown. In addition to those accounts listed on the trial balance, the chart of accounts...
Study smarter with the SolutionInn App