production and operation management ( inventory management)

EOQ PRACTISE a) The soft goods department of a large department store sells 175 units per month of a certain large bath towel. The unit cost of a towel to the store is RM2.50 and the cost of placing an order has been estimated to be RM12.00. The store uses an inventory carrying charge of I = 27% per year. Calculate : i. Optimal order quantity (3 marks) ii. Annual holding and ordering cost (3 marks) ili. Frekuensi pesanan / Order frequency (2 marks) b)If, through automation of the purchasing process, the ordering cost can be saving further 66.6% Calculate is New economic order quantity (3 marks) V. Annual holding and ordering cost (2 marks) vi. Order frequency (2 marks) POQ PRACTISE A toy manufacturer makes its own wind-up motors, which are then put into its toys. While the toy manufacturing process is continuous, the motors are intermittent flow. Data on the manufacture of the motors appears below. Annual demand (D) = 50,000 units Daily subassembly production rate = 1,000 Daily subassembly usage rate = 200 Setup cost (S) = $85 per batch Carrying cost = $.20 per unit per year calculate: i. Optimal order quantity (3 marks) ii. Number of days are required to produce a batch (1 marks) iii. The average inventory (2 marks) iv Total annual inventory cost (2 marks)