Question

. GOLDMEDAL Company estimated demand for gold-filled
medals. The demand is 2,420

medal per year. Manager Sibel has indicated that ordering cost is
45 TL, and the following

price schedule will be used by supplier. If you order medals
between 1 to 599 you pay 0.90

TL for each; If you order medals between 600 to 1,199 you pay 0.80
TL for each; and If

you order medals 1,200 or more, you pay 0.75 TL for each. What
order size will minimize

total cost if carrying cost is $.18 per medal on an annual basis?
(20 points)

Answer #1

Optimal Inventory Policy
The inventory manager has typically ordered a quantity of 800
each time an order is needed for one of their popular tires to take
advantage of the discount provided by the supplier and save the
company money. The following discount schedule has just been
received reflecting recent changes in some of the discount
percentages. The manager still maintains that an order quantity of
800 will save the company the most money because of the quantity
discount.
Order...

1. A hardware store sells paint that has a demand of 10,568
gallons per year. The store purchases the paint from a supplier for
15.0 dollars per gallon The unit holding cost per year is 19
percent of the unit purchase cost. while the ordering cost is 134
dollars per order. The paint supplier has a lead time of 8 days.
What is the annual holding cost if the store uses the order
quantity of 1,147 gallons per order? Assume...

A jewelry firm buys semiprecious stones to make bracelets and
rings. The supplier quotes a price of $8 per stone for quantities
of 600 stones or more, $9 per stone for orders of 400 to 599
stones, and $10 per stone for lesser quantities. The jewelry firm
operates 200 days per year. Usage rate is 25 stones per day, and
ordering costs are $48.
a.
If carrying costs are $2 per year for each stone, find the order
quantity that...

Hershey Company uses quantitative models for inventory control.
For canned syrup, the annual demand is 8,000 cases. The supplier is
500 miles away, and it usually takes three days to get an order
filled. The average order costs $16 to process and the carrying
cost per case is $40 per year. The store is open 300 days a
year.
A. Determine the economic order quantity.
B. Determine the reorder point if a safety stock of 24 cases is
desired.

13-29. The office manager for the Metro Life Insurance Company
orders letterhead stationery from an office product firm in boxes
of 500 sheets. The company uses 6500 boxes per year. Annual
carrying costs are $3 per box, and ordering costs are $28. The
following discount price schedule is provided by the office supply
company:
Order Quantity (boxes) Price per Box
200–999 $16
1000–2999 14
3000–5999 13
6000+ 12
A. Determine the optimal order quantity and the total annual
inventory cost....

Solve in ExcelQM
Barbara Bright is the purchasing agent for West Valve Company.
West Valve sells industrial valves and fluid control devices. One
of the most popular valves is the Western, which has an annual
demand of 4,000 units. The cost of each valve is $90, and the
inventory carrying cost is estimated to be 10% of the cost of each
valve. Barbara has made a study of the costs involved in placing an
order for any of the valves...

A creamery purchases three different types of cheese: panela
cheese at $3.75 per pound, goat cheese at $7.10 per pound, and
Oaxaca cheese at $4.50 per pound. The daily demand for each cheese
is 45, 22, and 63 pounds respectively. The creamery has a dedicated
supplier for each type of cheese, and the ordering cost is $2.00
per order. It is expensive to keep these products in inventory
because they are highly perishable. The holding cost is estimated
to be...

You manage inventory for your company and use a continuous
review inventory system to control reordering items for stock. Your
company is open for business 300 days per year. One of your most
important items experiences demand of 20 units per day, normally
distributed with a standard deviation of 3 units per day. You
experience a lead time on orders from your supplier of six days
with a standard deviation of two days. The unit price, regardless
of order size,...

The Queens Box Company experiences a constant demand of 48,000
boxes per year to operate its business. The unit cost is .30
(cents). Placing an order costs $20 and annual carrying costs are
$2/unit. The company operates 250 days per year and maintains a
safety stock of 576 boxes. The lead time for an order of boxes is 4
business days. The EOQ (rounded to the nearest whole number)
is:
a.
576 units
C.
3098 units
b.
490 units
d....

QUESTION 3
HIT Co demands 120,000 units of cogs a year. Every month, the
company pays £200 to place an order with its supplier. Each cog
costs £7.50 and the annual holding cost is £1.00 per unit. The
company maintains a buffer stock of cogs, which is sufficient to
meet demand for 10 working days.
Required:
a) What is the annual cost of inventory for HIT under the
current ordering policy?
b) Ignoring the bulk discount, what is the optimal...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 2 minutes ago

asked 3 minutes ago

asked 7 minutes ago

asked 14 minutes ago

asked 16 minutes ago

asked 26 minutes ago

asked 27 minutes ago

asked 27 minutes ago

asked 30 minutes ago

asked 43 minutes ago

asked 48 minutes ago

asked 49 minutes ago