Suppy Chain

Use the sales forecaster’s predication to describe a normal probability distribution that can be used to approximate the demand distribution. Sketch the distribution and show its mean and standard deviation.

Cost of inventory is determined using the average method; inventory is stated at the lower of cost or market. +pB13

Q9. Inventory carrying costs are based on the value of the product at the time it is held in inventory. When the product in sitting in the IDC Alliance Fort Worth Distribution Center, its value is a combination of purchase price plus any transportation costs to get it from the supplier to the DC plus in-transit carrying costs. On a per-unit bases (in dollars) what is the total inventory carrying cost for the safety stock and cycle stock inventory held at the Alliance Fort Worth Distribution Center if we purchase everything from Dong Hai Supply? From CousinsAg?

330-10-30330-10-30-1 The primary basis of accounting for inventories is cost, which has been defined generally as the price paid or consideration given to acquire an asset. As applied to inventories, cost means in principle the sum of the applicable expenditures and charges directly or indirectly incurred in bringing an article to its existing condition and location. It is understood to mean acquisition and production cost, and its determination involves many considerations. 330-10-30330-10-30-2 Although principles for the determination of inventory costs may be easily stated, their application, particularly to such inventory items as work in process and finished goods, is difficult because of the variety of considerations in the allocation of costs and charges.

EOQ is used to find the optimal order quantity so that the annual inventory cost is

2.2 Inventories (AASB 1019) as a general principle, inventories are valued at the lower of cost (including fixed and variable factory overheads where applicable) and net realizable value. Cost is determined on the basis of first-in-first-out, average or standard, whichever is the most appropriate in each case.

We first predict the annual demand for the year 1972 based on trend for 4 months of 1972 based on corresponding months of 1971.

7. Narragansett’s production is relatively constant throughout the year, but if its sales production were highly seasonal, could the EOQ model still be used? If so, would modifications be required? Explain.

Mr. Fischer made relatively conservative forecasts based on largely reasonable assumptions of seasonality, investment needed for PPE and continuing levels of sales. Based on the data at Mr. Fischer had in June 1995 it is difficult to criticize his projections.

With this company the inventory management ratios further indicate that there may be an issue with inventory and inventory controls. The inventory turnover ratio is lower than the industry average and the days’ sales in inventory are high. A company wants to turn inventory quickly to reduce storage costs, and

The sales forecast is based on projected levels of demand. All the numbers are expressed

Correct the EOQ and ROP quantities for each of the five items mentioned in the case.

In determining the fixed costs per unit for the period for absorption costing (not needed for variable costing since the entire fixed cost is expensed as a cost of the month, not a cost of units), you spread the fixed costs across all the units made. Since production was increased substantially, the fixed cost per unit was reduced:

(FIFO) policy, minimum stock reorder for each item and periodic stock evaluation. One of the

Yi ∈{0,1}, i ∈ I In the formulation, I refers to depots or facilities (1...m) that provide products to the customers, J refers to centers (1...n) where customers get their products. Fi refers to the fixed cost of operating depots i. dj refers to the demand of purchasing center j. cij refers to the cost of assigning purchasing