Calculate the EOQ size for the following case. What is the EOQ size and the number...
Calculate the EOQ size for the following case. What is the EOQ size and the number of orders placed per quarter? For your answer, round up the figures up to 0 decimal points. (size/number)
The average demand for the item is 540 units per quarter. It costs $150 to place an order. The item's price is $250 per unit and carrying cost ratio for the year is 20%.
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147 units/4 times per quarter |
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147 units/15 times per quarter |
||
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74 units/15 times per quarter |
||
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74 units/8 times per quarter |
Homework Answers
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Calculate the EOQ size for the following case. What is the EOQ
size and the number...
A company decides to establish an EOQ for an item. The annual demand is 400,000 units,...
A company decides to establish an EOQ for an item. The annual demand is 400,000 units, each costing $8, ordering costs are $32 per order, and inventory-carrying costs are 20%. Calculate the following: a. The EOQ in units b. Number of orders per year c. Cost of ordering d. Cost of carrying inventory e. Total Cost
CHAP 15 - Q13 DROPDOWN OPTIONS ARE BELOW THIS 13. Calculate economic ordering quantity (EOQ) Inventory...
CHAP 15 - Q13
DROPDOWN OPTIONS ARE BELOW THIS
13. Calculate economic ordering quantity (EOQ) Inventory costs can be categorized as the costs incurred for holding the inventory, the costs of ordering and receiving the inventory, and the cost of running out of inventory. costs are the direct and indirect costs of keeping inventory on hand. The number of units in the optimal size order is called the economic ordering quantity (E0Q). Murphy Company purchases custom-made durable packing boxes to...
b)what is the average inventory if the EOQ is used?... units (round your response to two...
b)what is the average inventory if the EOQ is used?... units
(round your response to two decimals)
c) what is the optimal number of orders per year?... orders
(round your response to two decimals)
d) what is the optimal number of days in between any two
orders?... days (round your response to two decimals)
e) what is the annual cost of ordering and holding inventory?
...$per year (round your response to two decimals)
f)what is the total annual inventory cost,...
The economic order quantity (EOQ) model is a classical model used for controlling inventory and s...
The economic order quantity (EOQ) model is a classical model used for controlling inventory and satisfying demand. Costs included in the model are holding cost per unit, ordering cost, and the cost of goods ordered. The assumptions for that model are that only a single item is considered, that the entire quantity ordered arrives at one time, that the demand for the item is constant over time, and that no shortages arc allowed. Suppose we relax the first assumption and...
3. Calculate the Economic Ordering Quantity (EOQ) model Aa Aa Inventory costs can be categorized as...
3. Calculate the Economic Ordering Quantity (EOQ) model Aa Aa Inventory costs can be categorized as the costs associated with holding the inventory, ordering and receiving the inventory, or running out of the inventory. For example, costs are the direct and indirect costs of keeping inventory on hand. carrying ordering The number of units in the optimal size order is called the economic ordering quantity (EOQ). Jones Company purchases custom-made durable packing boxes to ship its equipment. Each year, Jones...
Eagle Insurance is a large insurance company chain with a central inventory operation. The company’s fastest-moving...
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...
EOQ Thomas Corporation produces heating units. The following values apply for a part used in thei...
EOQ Thomas Corporation produces heating units. The following values apply for a part used in their production (purchased from external suppliers): D 7,605 Q- 195 P $ 33 C 3.30 Required: 1. For Thomas, calculate the ordering cost, the carrying cost, and the total cost associated with an order size of 195 units. If required, round your answers to the nearest cent. Ordering cost Carrying cost Total cost 2. Calculate the EOQ and its associated ordering cost, carrying cost, and...
Extra Credit - EOQ Problem A. What is the EOQ for a business that sells 5,000...
Extra Credit - EOQ Problem A. What is the EOQ for a business that sells 5,000 units each year when the cost of placing an order is $5.00 and the cost of carrying costs are $3.50 per order? B. How long will EOQ last and how many orders are placed annually (two calculations)? C. As a result of lower interest rates, management determines that the carrying cost fell from $3.50 to $1.80/unit. What is the new EOQ and annual number...
An aircraft company uses rivets at an approximate demand rate of 2,500 kg per year. Each...
An aircraft company uses rivets at an approximate demand rate of 2,500 kg per year. Each unit costs $ 30 per kg and the company personnel estimate that it costs $130 to place an order and that the carrying cost of inventory is 10 % per year. How frequently should orders for rivets be placed? Determine the optimum size of each order? Find EOQ, Order frequency T, Number of orders N and TC
PLEASE ANSWER ALL QUESTIONS: A grocery store in the community of Byera sells cases of bottled...
PLEASE ANSWER ALL QUESTIONS: A grocery store in the community of Byera sells cases of bottled water to its customers on a regular basis. Demand for the water is relatively constant with a rate of 150 cases per day. The store is open 250 days per year. The cost of a case of water is $20 The following information is available about the operation and purchase of the water: Ordering cost : $30. / order Annual holding cost per unit...
CHAP 15 - Q13
DROPDOWN OPTIONS ARE BELOW THIS
13. Calculate economic ordering quantity (EOQ) Inventory costs can be categorized as the costs incurred for holding the inventory, the costs of ordering and receiving the inventory, and the cost of running out of inventory. costs are the direct and indirect costs of keeping inventory on hand. The number of units in the optimal size order is called the economic ordering quantity (E0Q). Murphy Company purchases custom-made durable packing boxes to...
b)what is the average inventory if the EOQ is used?... units
(round your response to two decimals)
c) what is the optimal number of orders per year?... orders
(round your response to two decimals)
d) what is the optimal number of days in between any two
orders?... days (round your response to two decimals)
e) what is the annual cost of ordering and holding inventory?
...$per year (round your response to two decimals)
f)what is the total annual inventory cost,...
The economic order quantity (EOQ) model is a classical model used for controlling inventory and satisfying demand. Costs included in the model are holding cost per unit, ordering cost, and the cost of goods ordered. The assumptions for that model are that only a single item is considered, that the entire quantity ordered arrives at one time, that the demand for the item is constant over time, and that no shortages arc allowed. Suppose we relax the first assumption and...
3. Calculate the Economic Ordering Quantity (EOQ) model Aa Aa Inventory costs can be categorized as the costs associated with holding the inventory, ordering and receiving the inventory, or running out of the inventory. For example, costs are the direct and indirect costs of keeping inventory on hand. carrying ordering The number of units in the optimal size order is called the economic ordering quantity (EOQ). Jones Company purchases custom-made durable packing boxes to ship its equipment. Each year, Jones...
EOQ Thomas Corporation produces heating units. The following values apply for a part used in their production (purchased from external suppliers): D 7,605 Q- 195 P $ 33 C 3.30 Required: 1. For Thomas, calculate the ordering cost, the carrying cost, and the total cost associated with an order size of 195 units. If required, round your answers to the nearest cent. Ordering cost Carrying cost Total cost 2. Calculate the EOQ and its associated ordering cost, carrying cost, and...
Extra Credit - EOQ Problem A. What is the EOQ for a business that sells 5,000 units each year when the cost of placing an order is $5.00 and the cost of carrying costs are $3.50 per order? B. How long will EOQ last and how many orders are placed annually (two calculations)? C. As a result of lower interest rates, management determines that the carrying cost fell from $3.50 to $1.80/unit. What is the new EOQ and annual number...
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