Question

13) A furniture showroom expects to sell 250 sofas a year. Each sofa costs the $300, and there is a fixed charge of $500 per order. If it costs $100 to store a sofa for a year. In your asnwer provide the storgae cost function, reoder cost function, the total cost fuction, and use these information to answer how large should each order be and how often should order be placed to minimize inventory costs?

Answer #1

A bookstore expects to sell 400 calculus textbooks during the
next year. It costs $4 to store one calculus textbook for one
year. To reorder, there is a fixed cost of $12.50, plus $0.50 for
each calculus textbook ordered. In what lot size and how many times
per year should an order be placed to minimize inventory costs?

A bookstore expects to sell 120 120 calculus textbooks during
the next year. It costs $1.65 to store one calculus textbook for
one year. To reorder, there is a fixed cost of $11 , plus $1.50 for
each calculus textbook ordered. In what lot size and how many times
per year should an order be placed to minimize inventory costs?

Simpson’s Shoes expects to sell 315 pairs of a certain running
shoe in a year. There is a fixed charge of $140 per order and each
pair of shoes cost the store $7. It costs the store $8 to store a
pair of shoes for a year.
Find the inventory cost as a function of ONLY
the number of shoes/order.
Use methods of Calculus shown recently in class to minimize the
inventory costs. Give appropriate units.
x=____________________________
r=____________________________ Work->
Minimum...

A jewelry store expects to sell 120 diamond bracelets during the
next year. It costs $2.25 to store one diamond bracelet for one
year. There is a fixed cost of $15 for each order. Find the lot
size and the number of orders per year that will minimize inventory
costs.

A sporting goods store sells
100
pool tables per year. It costs
$50
to store one pool table for a year. To reorder, there is a
fixed cost of
$25
per shipment plus
$18
for each pool table. How many times per year should the store
order pool tables, and in what lot size, in order to minimize
inventory costs?

(ECP)A sporting goods store sells 100 pool tables per year. It
costs $20 to store one pool table for a year. To reorder, there is
a fixed cost of $40 per shipment plus $16 for each pool table. How
many times per year should the store order pool tables, and in what
lot size, in order to minimize inventory costs?

The Rhodes Furniture store gets an average of 300 customers per
shift. The manager of Rhodes wants to calculate whether she should
hire 1, 2, 3, or 4 salespeople. In deciding how many cashiers to
keep open each Saturday, she considers two factors: customer
waiting time (and the associated waiting cost) and the service
costs of employing additional checkout clerks. Checkout clerks are
paid an average of $8 per hour. When only one is on duty, the
waiting time per...

Santana Rey expects sales of Business Solutions’s line of
computer workstation furniture to equal 300 workstations (at a
sales price of $3,100 each) for 2019. The workstations’
manufacturing costs include the following.
Direct
materials
$
790
per unit
Direct
labor
$
380
per unit
Variable
overhead
$
60
per unit
Fixed
overhead
$
19,200
per year
The selling expenses related to these workstations
follow.
Variable selling
expenses
$
30
per unit
Fixed selling
expenses
$
3,100
per year
Santana is...

1. Santana Rey expects sales of Business Solutions’s line of
computer workstation furniture to equal 300 workstations (at a
sales price of $3,900 each) for 2018. The workstations’
manufacturing costs include the following.
Direct materials
$
720
per unit
Direct labor
$
390
per unit
Variable overhead
$
100
per unit
Fixed overhead
$
19,200
per year
The selling expenses related to these workstations
follow.
Variable selling expenses
$
40
per unit
Fixed selling expenses
$
3,700
per year
Santana...

Problems: Economic Order Quantity
1. Demand for the Deskpro computer at Best Buy is 1,000 units
per month. Best Buy incurs a fixed order placement, transportation,
and receiving cost of $4,000 each time an order is placed. Each
computer costs Best Buy $500 and the retailer has a holding cost of
20 percent.
A. Evalua te the number of computers that the store manager
should order in each replenishment lot.
B. What is the total inventory cost?
C. What is...

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