Question

b) As a contractor to Petronas, East Technology uses 4000 valves for repairing one of Petronas plant every year. These valves are purchased from a supplier 200 km away. The following information is known about the valves Table Q3b: Forecast demand for plastic product Annual demand 4000 Holding cost /valve/vear Order cost/ year RM 9 RM 25 s days Lead time Working days per year 250 Given the above information, calculate i) The economic order quantity (EOQ)? ii) The annual inventory holding cost? ii) How many orders would be made each year? iv) What would be the annual inventory order cost? v) The total annual cost of managing the inventory? vi) What is the reorder point (ROP)

Answer 1

en - RM Max inVentolyminimvenfe aluable Og

EC E o )Then veloy helding Co9t Pmax inven t mi'n inven 1H9 2 RM 670.g

SEoS RM 671.140939 Total ame! cest ef managirg the annual C ота inven gp tost 670's 6커써0939 Rm 13H1, 6H093

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