ZuoTi.Pro
Question

Alexis Company uses 800 units of product per year on a continuous basis. The product has...

Alexis Company uses 800 units of product per year on a continuous basis. The product has a fixed cost of $50 per order, and its carrying cost is $2 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 day’s usage in inventory as safety stock.

a. Calculate the EOQ

b. Determine the average level of inventory (Note: Use a 365-day year to calculate day usage)

c. Determine reorder point

d. Indicate which of the following variables change if the firm does not hold the safety stock: (1) order cost, (2) carrying cost, (3) total inventory cost, (4) reorder point, (5) economic order quantity. Explain

business   Operations-Management   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

✔ Recommended Answer
Answer #1

1.2.200 unit》/4eax 3 $50 LT 5 steek.︾ 10 days us | 2x300 50 2 : , | 200 unit 365days B00 365 2 19 X10 = 100 + 213 121,9 on 2usill mot chorau b be lus ithientou without-54e,steek 一(3) The bohal inventou t cast ueell durease as earn ruF cast uill 5The

2 0
Add a comment
Know the answer?
Add Answer to:
Alexis Company uses 800 units of product per year on a continuous basis. The product has...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Similar Homework Help Questions

  • Alexis Company uses 881 units of a product per year on a continuous basis. The product...

    Alexis Company uses 881 units of a product per year on a continuous basis. The product has a fixed cost of ​$45 per​ order, and carrying cost is $4 per unit per year. It takes 5 days to receive a shipment after an order is​ placed, and the firm wishes to hold 10​ days' usage in inventory as a safety stock. a.  Calculate the EOQ in units b.  Determine the average level of inventory.   ​(Note​:  Use a​ 365-day year to...

  • EOQ, reorder point, and safety stock Alexis Company uses 631 units of a product per year...

    EOQ, reorder point, and safety stock Alexis Company uses 631 units of a product per year on a continuous basis. The product has a fixed cost of $41 per order, and its carrying cost is $4 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note:...

  • EOQ, reorder point, and safety stock Alexis Company uses 805 units of a product per year...

    EOQ, reorder point, and safety stock Alexis Company uses 805 units of a product per year on a continuous basis. The product has a fixed cost of $50 per order, and its carrying cost is $4 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note:...

  • EOQ, reorder point, and safety stock Alexis Company uses 907 units of a product per year...

    EOQ, reorder point, and safety stock Alexis Company uses 907 units of a product per year on a continuous basis. The product has a fixed cost of $57 per order, and its carrying cost is $5 per unit per year It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note:...

  • Alexis Company uses 900 units of a product per year on a continuous basis. The product...

    Alexis Company uses 900 units of a product per year on a continuous basis. The product has a fixed cost of $55 per order, and its carrying cost is $2 per unit per year. It takes 5 days to receive a shipment after an order is placed. And the firm wishes to hold 10 days usage in inventory as a safety stock Indicate which of the following variable change if the firm does not hold the safety stock: (1) order...

  • 1. Tangshan Mining was extended credit terms of 2/10 net 30. The cost of giving up...

    1. Tangshan Mining was extended credit terms of 2/10 net 30. The cost of giving up the cash discount, assuming payment would be made on the last day of the credit period, would be 2. The General Chemical Company uses 1,100,000 gallons of hydrochloric acid per year. The cost of carrying the chemical in inventory is 50 cents per gallon per year, and the cost of ordering the chemical is $110 per order. The firm uses the chemical at a...

  • E15-3 Mama Leone's Frozen Pizzas uses 50,000 units of cheese per year. Each unit costs $2.50. The ordering cost for the...

    E15-3 Mama Leone's Frozen Pizzas uses 50,000 units of cheese per year. Each unit costs $2.50. The ordering cost for the cheese is $250 per order, and its carrying cost is $0.50 per unit per year. Calculate the firm's economic order quantity (EOQ) for the cheese. Mama Leone's operates 250 days per year and maintains a minimum inventory level of 2 days' worth of cheese as a safety stock. If the lead time to receive orders of cheese is 3...

  • Mayer, Inc. predicts it will use 63,000 units of material during the year. The expected daily...

    Mayer, Inc. predicts it will use 63,000 units of material during the year. The expected daily usage is 500 units, and there is an expected lead time of five days and the desired safety stock of 1,500 units. The material is expected to cost $5 per unit. Mayer anticipates it will cost $194.45 to place each order. The annual carrying cost is $.50 per unit. Required: Compute the order point. Determine the most economical order quantity by use of the...

  • ​Sam's Cat Hotel operates 52 weeks per​ year and uses a continuous review inventory system. It...

    ​Sam's Cat Hotel operates 52 weeks per​ year and uses a continuous review inventory system. It purchases kitty litter for ​$10.75 per bag. The following information is available about these bags. Demand = 85 bags/week Order cost = $57/order Annual holding cost = 26% of cost per bag Desired cycle-service level = 90% Lead-time = 2 weeks Standard deviation of weekly demand = 18 bags What is the economic order quantity (EOQ) for kitty litter? What would be the average...

  • A product with an annual demand of 1000 units has EOQ (Economic Order Quantity) = 80....

    A product with an annual demand of 1000 units has EOQ (Economic Order Quantity) = 80. The demand during the lead time follows a normal probability distribution with µ = 25 and ϭ =5 during the reorder period. How much safety stock is required, if the firm desires at most a 2% probability of a stockout on any given order cycle? If a manager sets the reorder point at 30, what is the probability of a stockout on any given...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
Active Questions
ADVERTISEMENT