The superComputer is a computer store that sells various computer hardware and software You have been given the following information regarding a certain laptop Average weekly demand (52 weeks year) 60 The standard deviation of weekly demand 12 Order lead time 3 weeks The standard deviation of order lead time 0 Unit cost 350 Order cost 2 Annual unit holding cost 48 Service level 99 (z 2 33) What is the EOQ for the laptop Calculate annual ordering and holding costs for the laptop (ignoring safety stock) What do you notice and how would this affect your stocking policy If SuperComputer currently orders 120 laptops at a time, how much more or less would SuperComputer pay in annual holding and ordering costs if they were to order just 12 laptops at a time What is the reorder point for the laptop and how much of this consists of safety stock What are the annual holding costs when considering safety stock How much of this cost is due to the safety stock being held If SuperComputer wants to reduce their order lead time to one week what would be the new safety stock and how would this affect annual holding costs

Question: The superComputer is a computer store that sells various computer hardware and software. You have been given the following information regarding a certain laptop: Average

The superComputer is a computer store that sells various computer hardware and software. You have been given the following information regarding a certain laptop:

Average weekly demand (52 weeks/year)	60
The standard deviation of weekly demand	12
Order lead time	3 weeks
The standard deviation of order lead time	0
Unit cost	€350
Order cost	€2
Annual unit holding cost	€48
Service level	99% (z = 2.33)

What is the EOQ for the laptop?

Calculate annual ordering and holding costs for the laptop (ignoring safety stock). What do you notice and how would this affect your stocking policy?

If SuperComputer currently orders 120 laptops at a time, how much more or less would SuperComputer pay in annual holding and ordering costs if they were to order just 12 laptops at a time?

What is the reorder point for the laptop and how much of this consists of safety stock?

What are the annual holding costs when considering safety stock? How much of this cost is due to the safety stock being held?

If SuperComputer wants to reduce their order lead time to one week what would be the new safety stock and how would this affect annual holding costs?

Step by Step Solution

★★★★★

3.47 Rating (150 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

1 EOQ 161245 or 16rounded to the nearest whole number 2 It is notice... View full answer

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 Economics Questions!

You have been given the following information for RPE Consulting for the year ended July 31, 2014. Required 1. Prepare the company's income statement, statement of changes in equity, and balance...

You have been given the following information about ALG Co. Ltd., which uses a standard cost system in accounting for its one product: 1. In the month of November 2016, 5,000 units were produced. 2....

You have been given the following information about ALG Co. Ltd., which uses a standard cost system in accounting for its one product: 1. In the month of November 2012, 5,000 units were produced. 2....

Reconstructing the income statement and balance sheet Computer Needs, Inc., operates a retail store that sells computer hardware and software. It began operations on January 2, 2007, and operated...

With the explosion of computer hardware and software during the 1970s and 1980s, companies began developing models to assess the technical risk for the computer hardware and software effort. One such...

Trading Securities Entries on December 21, 2010, Zurich Company provided you with the following information regarding its trading securities. During 2011, Carolina Company stock was sold for $9,500....

You have the following information for Prospector Gems. Prospector uses the periodic method of accounting for its inventory transactions. Prospector only carries one brand and size of diamondsall are...

Imagine that one of your parents has traveled across the country to visit you at college. As the two of you have dinner together at one of your favorite restaurants, the discussion turns to your...

Larkin State University is a medium-sized academic institution located in the Southeastern United States. The university employs about 250 full-time faculty and 300 staff personnel. There are 12,000...

Make versus buy, ethics. (CMA, adapted) Lynn Hart is a management accountant at Paibec Corporation. Paibec is under intense cost competition. Hart has been asked to evaluate whether Paibec should...

Write one paragraph discussing why the economy has a natural unemployment rate and how altering that natural state can cause economic issues. Provide an example of what can happen to inflation and,...

How is data analytics being used to enhance food and beverage services in the hospitality industry, particularly in fine dining establishments? please provide a citation

Mini-Case: Watch Out All Retailers, Here Comes Amazon; Watch Out Amazon, Here Comes Other Competitors Amazon's sales in 2014 were $88.99 billion, an increase of 19.4 percent over 2013. In fact, its...

In particular What did Dr. Balanoff and other researchers discover about the size of the dinosaur cerebrum in non-bird dinosaurs closely related to birds?

1. Consider the output of a paper mill: the product appears at the end of a web and is rolled onto a spool called a reel. Every reel is examined for the number of blemishes, which are imperfections....

provide the step-by-step calculations for this question: Rod BD is made of steel ( E = 29 10 6 psi) and is used to brace the axially compressed member ABC . The maximum force that can be developed in...

COST OF EQUITY Question The market rate of return is 11.8 percent and the risk-free rate is 3.45 percent. Galaxy Co. has 36 percent more systematic risk than the overall market and has a dividend...

The process of collaborative goal setting by a manager and subordinate, the extent to which goals are accomplished is a major factor in evaluating and rewarding the subordinate's performance. It is...

Ten years ago, Hailey invested $3,000 and locked in an 8 percent annual interest rate for 30 years (end 20 years from now). Aidan can make a 20-year investment today and lock in a 10 percent interest...

Using the information in the table, compute the required return for each company using both CAPM and the constant growth model. Compare and discuss the results. Assume that the market portfolio will...

How many possible IRRs could you find for the following set of cash flows? Discuss. Time 1 4 Cash Flow -$211,000 -$39,350 $440,180 $217,520 -$2,000

A study measured the Waist Size of 250 men, finding a mean of 36.33 inches and a standard deviation of 4.02 inches. Here is a histogram of these measurements. a) Describe the histogram of Waist Size....

You roll a die, winning nothing if the number of spots is odd, $1 for a 2 or a 4, and $10 for a 6. a) Find the expected value and standard deviation of your prospective winnings. b) You play twice....

The candy company claims that 10% of the M&M's it produces are green. Suppose that the candies are packaged at random in small bags containing about 50 M&M's. A class of elementary school students...