Question: Petromax Enterprises uses a continuous review inventory control system for one of its SKUs. The following information is available on the item. The firm operates
Petromax Enterprises uses a continuous review inventory control system for one of its SKUs. The following information is available on the item. The firm operates 52 weeks in a year.
Demand=83,200 units/year
Ordering cost= $38.50/order
Holding cost=3.50/unit/year
Average lead time= 9 week
Standard deviation of weekly demand = 120 units
a. the economic order quantity for this item is ___ units
b. if petromax wants to provide a 92% service level, the safety stock is __ units
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
