Question: Phillip Flamm's Computer Store in Texas sells a printer for $180. Demand is constant during the year, and annual demand is forecasted to be 900

Phillip Flamm's Computer Store in Texas sells a printer for $180. Demand is constant during the year, and annual demand is forecasted to be 900 units. Holding cost is $15 per unit per year, whereas the cost of ordering is $75 per order. Currently, the company is ordering 12 times per year ( units each time). There are 250 working days per year, and the lead time is 7 days.

a) Given the current policy of ordering units at a time, the total of the annual ordering cost and the annual holding cost is $_______ (round your response to the nearest whole number).

b) If the company used the absolute best inventory policy, the total of ordering and holding cost is $________ (round your response to the nearest whole number).

c) The reorder point is ______ units (round your response to the nearest whole number).

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!