Question: What is the total annual cycle - inventory cost ( i . e . , holding cost + ordering cost ) of the two parts,

What is the total annual cycle-inventory cost (i.e., holding cost + ordering cost) of the two parts, respectively, based on their current ordering quantity?
What is the economic order quantity (EOQ) for the two parts? What would be the total cost (i.e., holding cost + ordering cost) of the two parts, respectively, if they were to switch to EOQ? How are they different from the current costs?
What are the reorder points (R) for the two parts, respectively, if Sue were to adopt a continuous-review system (Q-system)?
What are the time between orders (P) and the target inventory (T) for the two parts, if Sue were to adopt a period-review system (P-system)?
Which ordering system (Q or P) would you recommend for each of the two parts? Why?
 What is the total annual cycle-inventory cost (i.e., holding cost +

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!