A small copy center uses five 500-sheet boxes of copy paper a week. Experience suggests that usage can be well approximated by a normal distribution with a mean of five boxes per week and a standard deviation of one-half box per week. One weeks are required to fill an order for letterhead stationery. Ordering cost is $3, and annual holding cost is 25 cents per box. Use Table. a. Determine the economic order quantity, assuming a 52-week year. (Round your answer to the nearest whole number.) EOQ boxes b. If the copy center reorders when the supply on hand is 6 boxes, compute the risk of a stockout. (Round "z" value to 2 decimal places and final answer to 4 decimal places.) Risk c. If a fixed interval of seven weeks is used for ordering instead of an ROP, how many boxes should be ordered if there are currently 8 boxes on hand, and an acceptable stockout risk for the order cycle is .0170? (Round "z" value to 2 decimal places and final answer to the nearest whole number.) Q0
Economic Order Quantity refers to the number of unit the company should add to the inventory and the order is made to minimize the total inventory cost. It maintain a balance between ordering costs and carrying costs. The total inventory cost include the Annual ordering cost, holding cost and total product cost.
A small copy center uses five 500-sheet boxes of copy paper a week. Experience suggests that...
A small copy center uses 5 560-sheet boxes of copy paper a week. Experience suggests that usage can be well approximated by a normal distribution with a mean of 5 boxes per week and a standard deviation of .50 boxes per week. 2 weeks are required to fill an order for letterhead stationery. Ordering cost is $5, and annual holding cost is 34 cents per box. Use Table. a. Determine the economic order quantity, assuming a 52-week year. (Round your...
A small copy center uses 6 420-sheet boxes of copy paper a week. Experience suggests that usage can be well approximated by a normal distribution with a mean of 6 boxes per week and a standard deviation of .60 boxes per week. 2 weeks are required to fill an order for letterhead stationery. Ordering cost is $6, and annual holding cost is 35 cents per box. Use Table. a. Determine the economic order quantity, assuming a 52-week year. (Round your...
Clap Off Manufacturing uses 2,400 switch assemblies per week and then reorders another 2,400. Assume the relevant carrying cost per switch assembly is $6.10 and the fixed order cost is $565. a. Calculate the carrying costs. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. Calculate the restocking costs. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) c. Calculate the economic order quantity. (Do...
Problem 6- Fixed Order Interval (FOI) Demand for walnut fudge ice cream at the Sweet Cream Dairy can be approximated by a normal distribution with a mean of 21 gallons per week and a standard deviation of 3.2 gallons per week. The new manager desires a service level of 90 percent. Lead time is two days, and the dairy is open seven days a week. (Hint: Work in terms of weeks.) Use Table B and Table B1. a-1. If an...
A mail-order house uses 16,260 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies. Number of Boxes Price per Box 1,000 to 1,999 $1.25 2,000 to 4,999 1.20 5,000 to 9,999 1.15 10,000 or more 1.10 a. Determine the optimal order quantity. (Round your answer to the nearest whole number.) Optimal order quantity boxes b. Determine the number of orders per year. (Round...
Demand for walnut fudge ice cream at the Sweet Cream Dairy can be approximated by a normal distribution with a mean of 21 gallons per week and a standard deviation of 3.0 gallons per week. The new manager desires a service level of 90 percent. Lead time is two days, and the dairy is open seven days a week. (Hint: Work in terms of weeks.) Use Table B and Table B1. a-1. If an ROP model is used, what ROP...
Sam's Cat Hotel operates 52 weeks per year, 7 days per week, and uses a continuous review inventory system. It purchases kitty litter for $11.25 per bag. The following information is available about these bags. Refer to the standard normal table for z-values. Demand 96 bags/week Order cost- $58/order >Annual holding cost 26 percent of cost > Desired cycle-service level 90 percent > Lead time 1 week(s) (7 working days) > Standard deviation of weekly demand 13 bags >Current on-hand...
University of Florida football programs are printed 1 week prior to each home game. Attendance averages 90,000 screaming and loyal Gators fans, of whom two-thirds usually buy the program, following a normal distribution, for $55 each. Unsold programs are sent to a recycling center that pays only 10 cents per program. The standard deviation is 10,000 programs, and the cost to print each program is $11. Refer to the standard normal table LOADING... for z-values. a) What is the cost...
Dr. Jack is in charge of the Springfield Hospital's Blood Center. Blood is collected in the regional Blood Center 200 miles away and delivered to Springfield by airplane. Dr. Jack reviews blood reserves and places orders every Monday morning for delivery the following Monday morning. If demand begins to exceed supply, surgeons postpone nonurgent procedures, in which case blood is back-ordered. Demand for blood in a week is normally distributed with a mean of 100 pints and a standard deviation...
High Tech Inc. is a virtual store that stocks a variety of calculators in its warehouse. Customer orders are placed; the orders are picked and packaged; and then orders are shipped to the customers. A fixed-order-quantity inventory control system (FQS) helps monitor and control these SKUs. The following information is for one of the calculators that High Tech stocks, sells, and ships. Average demand 9.5 calculators per week Lead time 5 weeks Order cost $15/order Unit cost $10.00 Carrying charge...