SECTION B

Instructions: Answer any THREE $(3)$ questions from this section.

Question $1$

Waltz Ltd is a retailer of plastic. The company has an annual demand of $18375$ containers. The container cost $$6$ each. Fresh supplies can be obtained immediately, but ordering costs and the cost of carriage inwards are $$100$ per order. The annual cost of holding one container in inventory is estimated to be $$1\mathrm{.}20.$

Required:

a$.$ Calculate the EOQ from the above information.

$(2$ marks$)$

b$.$ The following data was taken from a company.

$\backslash$table$[[$Minimum lead time,$8$ days$],[$Average lead time,$10$ days$],[$Maximum lead time,$14$ days$],[$Maximum usage,$1000$ units per day$],[$Minimum usage,$600$ units per day$],[$Re$-$order quantity,$10800$ units$]]$

Calculate:

i$.$ Average usage

$(2$ marks$)$

ii$.$ Reorder level

$(2$ marks$)$

iii. Minimum Control Level

$(2$ marks$)$

iv$.$ Maximum Control Level

$(2$ marks$)$

c$.$ Boxit Ltd$.$ sells box juices and had the following transactions for the month of December. Stock on hand December $1,2013$ was $45$ units @ $$200.$

Purchases

Dec $02$

Dec $08$

Dec $15$

Dec $22$

$75$ units @ $$205$

$30$ units @ $210$

$20$ units @ $$215$

$70$ units @ $$225$

Dec $06$

Dec $10$

Dec $23$

Sales

$55$ units @ $$250$

$40$ units @ $$260$

$85$ units @ $$270$

Required: