You are an operations manager for Bay Blades Inc. This company sells specialty blades for cutting...

 

  

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You are an operations manager for Bay Blades Inc. This company sells specialty blades for cutting different types of stone used for landscaping. The Vice President has asked you to review the inventory situation to see if the company is operating at an optimal level. Bay Blades Inc. buys all of its A55-Diamond Blades from a producer in Germany. The inventory data that you collected was: Stone Cutting Blade Sales in Units per Year A55 Diamond Blades in Inventory: 85.000 Selling Weeks per Year 50 9,000 Lead Time from Germany in Weeks: Recommended Safety Stock in Units $10,750,000 350 Inventory Investment: Annual COGS: $42,500,00O $110 $9 Order Cost/Order: Yearly Holding Cost/Unit: Formulas ROP = ddLT + SS Inventory Turns Cost of Goods Sold / Inventory Value Weeks Supply = Inventory Value /Average Weekly COGS OR = # Weeks/Turns EOQ = sqrt(2DS/H) Please show all your work. Answer all 4 questions in the box below. a) What quantity should be ordered each time? (4 marks) b) Calculate Reorder Point (3 marks) c) Caiculate Weeks of Supply (2 marks) d Given the information above, is Bay Blades Inc. managing their cutting blades inveatory well? Justify your answer with specific recommendations? (3 marks) You are an operations manager for Bay Blades Inc. This company sells specialty blades for cutting different types of stone used for landscaping. The Vice President has asked you to review the inventory situation to see if the company is operating at an optimal level. Bay Blades Inc. buys all of its A55-Diamond Blades from a producer in Germany. The inventory data that you collected was: Stone Cutting Blade Sales in Units per Year A55 Diamond Blades in Inventory: 85.000 Selling Weeks per Year 50 9,000 Lead Time from Germany in Weeks: Recommended Safety Stock in Units $10,750,000 350 Inventory Investment: Annual COGS: $42,500,00O $110 $9 Order Cost/Order: Yearly Holding Cost/Unit: Formulas ROP = ddLT + SS Inventory Turns Cost of Goods Sold / Inventory Value Weeks Supply = Inventory Value /Average Weekly COGS OR = # Weeks/Turns EOQ = sqrt(2DS/H) Please show all your work. Answer all 4 questions in the box below. a) What quantity should be ordered each time? (4 marks) b) Calculate Reorder Point (3 marks) c) Caiculate Weeks of Supply (2 marks) d Given the information above, is Bay Blades Inc. managing their cutting blades inveatory well? Justify your answer with specific recommendations? (3 marks)