help please! 12. Which of the following is NOT an assumptionof the EOQ model?A. Ordering cost is fixedB. Annual demand is knownC. The order is received the instant it is madeD. The stock is used up in a random manner13. If the daily demand of a company is 50 and theyhave a lead time in days of 4, what is theirreorder point?А. 200В. 220С. 240D. 26014. Which of the following is an example of ordercost?A. insuranceB. refrigerationC. rentD. transportation15. Which of the following is NOT an assumptionof the BOQ model?A. Inventory is replenished instantaneouslyB. Ordering cost is constantC. The stock is used up graduallyD. The annual demand is known3

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Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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At Dot Com, a large retailer of popular books, demand isconstant at 20,400 books per year. The cost of placing anorder to replenish stock is $35, and the annual cost of holdingis $6 per book. Stock is received 5 working days after an orderhas been placed. No backordering is allowed. Assume 250working days a year.a. What is Dot Com’s optimal order quantity?b. What is the optimal number of orders per year?c. What is the optimal interval (in working days) betweenorders?
Using excel. Apply the EOQ model to the following quantity discountsituation for which D5 500 units per year, Co5 $40, and theannual holding cost rate is 20%. What order quantity do yourecommend?DiscountDiscountCategoryOrder Size(%)unit Cost10 to990$10.002100 or more3$9.70
A company has an annual demand of 16,000 products. The products cost $2 each. Ordering and transport costs amount to $200 per order. The annual cost of holding one product in stock is estimated to be $1.20 . Assume that the company adopts the EOQ as its order quantity and it has to have half of the EOQ as inventory on hand when an order is placed. How many weeks does it take for an order to be delivered to the company? (1 year = 52 weeks) A) PPE may be credited by 2 million dollarsB) Revaluation OCI may be credited by 3,3 million dollarsC) Accumulated depreciation may be debited by 4 million dollarsD) Accumulated depreciation may be credited by 1,3 million dollarsE) Other (Please Specify)
The manager of a hardware store decides to use theEOQ with shortages model to determine the orderingpolicy for tape measures. Using economic considerations,the manager determines that she should usean order quantity of Q 5 30 and have a maximumshortageof b 5 3. The lead time for her supplier todeliver an order is L working days, where there are sixworking days in a week. (Essentially, you can ignoreSundays.) The weekly demand is for 20 tape measures.What reorder point should the manager use ifL 5 3; if L 5 5; if L 5 10? (Hint: The manager shouldplan her orders so that the inventory level is 2b whenan order arrives.)
The Fed increases the interest rate suddenly, leading to a sharp and immediate increase in loan interest rates. How will the EOQ behave in the immediate/short run? Assume all other variables stay relatively unchanged in the immediate term. EOQ = Sq root of [(2D*S)/H] D = annual demand in units S = cost of placing 1 order; H = cost of holding 1 unit of that item in inventory for 1 year EOQ will not be affected EOQ will increase EOQ will decrease
In the calculation of an optimal policy for an all-units discount schedule, you firstcompute the EOQ values for each of the three order costs, and you obtain: Q(0) =800, Q(1) =875, and Q(2) =925. The all-units discount schedule has breakpointsat 750 and 900. Based on this information only, can you determine what the optimal order quantity is? Explain your answer.
Penalty costs can be assessed only against the number of units of demand that cannot be satisfied, or against the number of units weighted by the amount of time thatan order stays on the books. Consider the following history of supply and demandtransactions for a particular part:Number of Items Demand duringMonth Received MonthJanuary 200 520February 175 1,640March 750 670April 950 425May 500 280June 2,050 550Assume that starting inventory at the beginning of January is 480 units.a. Determine the ending inventory each month. Assume that excess demands areback-ordered.b. Assume that each time a unit is demanded that cannot be supplied immediately,a one-time charge of $10 is made. Determine the stock-out cost incurred duringthe six months (1) if excess demand at the end of each month is lost, and (2) ifexcess demand at the end of each month is back-ordered.c. Suppose that each stock-out costs $10 per unit per month that the demandremains unfilled. If demands are filled on a first-come,…
c. Once you find the optimal order quantity i.e., EOQ, create a Data Table that generates inventory cost within ±100 units (with 10units increment) from the optimal order quantity. For example, if the EOQ=150, then you need to generate Data Table for inventory cost starting from 50 to 250 with 10 increments. Explain the exact steps completed in excel to create the data table d. Create a Scatter plot with “smooth lines” for the Data Table created in c) to show the inventory cost. Label your plot clearly (axis and title). The optimum order quantity should indicate the minimum cost in your plot.
Hammonds Corporation is trying to decide between two alternate order plans for itsinventory of a certain item. Irrespective of the plan to be followed, demand for the item isexpected to be 1,000 units annually. Under Plan A: order costs would be $ 40 per orderand inventory holding costs (carrying cost) would be $100 per unit per annum. Under PlanB order costs would be $30 per order, while holding costs would be 20% of unit cost whichis $480.Determine:i. the economic order quantity for EACH plan ii. total inventory cost for EACH plan iii. hence, indicate which plan would be better for the company
Given 150 units of beginning inventory, a lead time of oneperiod, an ordering cost of $400 per order, and a holdingcost of $2 per unit per period, determine which lot sizing technique would result in the lowest total cost for the fol-lowing demand data. Period 1 2 3 4 5 6 7 8Gross Requirements 100 90 85 70 150 200 300 250
27- In the economic order quantity model, the optimal quantity (EOQ) is always A. Less than the maximum inventory B. The same as the average inventory C. Greater than the maximum inventory D. The same as the maximum inventory
Exercise 2: The demand per year (D) for product X is 12,100 units. The costs of placing an order (S) are $4.50. The unit cost (C) of the item is $25.00. The maintenance cost (H) per unit per year is 30% of the item's cost. 1. Use the economic order quantity (EOQ) model to determine: *Optimal quantity to order* The expected number of orders*Optimal time between orders*The total annual cost of maintaining that optimal amountNOTE: Show calculations of how you arrived at each amount 2. Answer, what are the potential benefits of using EOQ analysis for inventory management? How can you help businesses strike a balance between inventory holding costs and ordering costs?

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12. Which of the following is NOT an assumption of the EOQ model? A. Ordering cost is fixed B. Annual demand is known C. The order is received the instant it is made D. The stock is used up in a random manner