Annual Demand | D | 40000 | ||
Ordering Cost | S | 15 | Per order | |
Carrying Cost | H | 3 | per year | |
Lead time | L | 30 | days | |
Demand in lead tiem | Dl | 250 | units | |
1 | calculating Optimal quantity | |||
Q*= | sqrt( (2*D*S)/H) | |||
Q* | 633 | |||
Optimal no of orders | 63 | orders | ||
Days Betewwn Orders | 6 | days | ||
2 | Annual Inventory Cost | |||
Lead time inventory | 250 | |||
Total Lead time inventory in year( L*Optimal Orders) | 15750 | |||
Annula Inventory Cost | 47250 | |||
3 | Average invenotry will be the lead time demand | 250 | units | |
4 | The purpose of ABC Analysis | |||
ABC
analysis divides inventory to 3 classes . This method focuses on
cirital parts and not trivial ones. Class A:high annual dollar volume Class B: Medium annul dollar volume Class C-Low annual dollar volume Focus for this analysis is the high dollar value items. |
||||
5 | Inventory Control : is the critial part of any production. Inventory is cash invested and not yielding any return. The idea of inventory is to prevent stock outs which will be loss of fianacial value as well reputation. So Inventory Control has to be balanced between what level you want inventories to be and above which level it makes no financial sense. The Inventory control has several methodologies devleoped with Saftey stock concept and levle of service. |
2. Annual demand for a famous speaker component for small stereo na for a famous speaker...
2. win Lee has determined that the annual demand for number 6 screws is 100,000 screws. Irwin, who works in his brother's hardware store, is in charge of purchasing. He estimates that it costs $10 every time an order is placed. This cost includes his wages, the cost of the forms used in placing the order, and so on. Furthermore, he estimates that the cost of carrying one screw in inventory for a year is one-half of 1 cent. (a)...
Alexander Cherry has determined that the annual demand for number 6 screws is 2. 200,000 screws. Alexander, who works in his brother's hardware store, is in charge of purchasing. He estimates that it costs $10 every time an order is placed. This cost includes his wages, the cost of the forms used in placing the order, and so on. Furthermore, he estimates that the cost of carrying one screw in inventory for a year is one-half of 5 cents. (a)...
A buyer for a large vehicle manufacturer has determined that the annual demand for number 6 screws is 100,000 screws. She estimates that it costs $10 every time she places an order. Furthermore, she estimates that the cost of carrying one screw in inventory for a year is one-half of 1 cent. Additionally, it takes approximately 8 working days for an order of number 6 screws to arrive once the order has been placed. The demand is considered quite stable...
1 - the annual demand for product 15600 units the weekly demand is 280 units with a standard deviation 90 units the cost to place an order is $31.00 and the time from order to receipt is 4 weeks the annual inventory carrying cost is $0.10 per unit A- what is the EOQ quantity? B- from the information above what is the reorder point maintain a 95% service level? 2 - the weekly demand is 200 units the cost to...
Case 2: Lila Battle has determined that the annual demand for number 6 screws is 100,000 screws. Lila, who works in her brother's hardware store, is in charge of purchasing. She estimates that it costs $10 every time an order is placed. This cost includes her wages, the cost of the forms used in placing the order, and so on. Furthermore, she estimates that the cost of carrying one screw in inventory for a year is one-half of 1 cent....
Thomas Kratzer is the purchasing manager for the headquarters of a large insurance company chain with a central inventory operation. Thomas’s fastest moving inventory item has a demand of 6000 units per year. The cost of each unit is $100.00, and the inventory carrying cost is $10.00 per unit per year. The average ordering cost is $30.00 per order. It takes about 5 days for an order to arrive, and demand for 1 week is 120 units (this is a...
Eagle Insurance is a large insurance company chain with a central inventory operation. The company’s fastest-moving inventory item has a demand of 80,000 units per year. The cost of each unit is $200, and the inventory carrying cost is $15 per unit per year. The average ordering cost is $60 per order. It takes about 2 days for an order to arrive. This is a corporate operation, and there are 250 working days per year. (Please show all work including...
A company decides to establish an EOQ for an item. The annual demand is 400,000 units, each costing $8, ordering costs are $32 per order, and inventory-carrying costs are 20%. Calculate the following: a. The EOQ in units b. Number of orders per year c. Cost of ordering d. Cost of carrying inventory e. Total Cost
A manufacturer keeps a continuous inventory review system on the key component, part X. The annual demand on part X is 12,000 units and the demand rate is constant. The supplier charges $50 for each unit of part X. Each order costs $150 to process and annual holding cost per unit is 20% of the purchase price. (a) What is the economic order quantity? How many orders will be placed each year (365 days)? If the lead time is 3...
b)what is the average inventory if the EOQ is used?... units
(round your response to two decimals)
c) what is the optimal number of orders per year?... orders
(round your response to two decimals)
d) what is the optimal number of days in between any two
orders?... days (round your response to two decimals)
e) what is the annual cost of ordering and holding inventory?
...$per year (round your response to two decimals)
f)what is the total annual inventory cost,...