* 12.17 Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The company operates its production facility 300 days per year. It has orders for about 12,000 flashing lights per year and has the capability of producing 100 per day. Setting up the light production costs $50. The cost of each light is $1. The holding cost is $0.10 per light per year. a) What is the optimal size of the production run? b) What is the average holding cost per year? c) What is the average setup cost per year? d) What is the total cost per year, including the cost of the lights? Px

* 12.17 Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The company operates its production facility 300 days per year. It has orders for about 12,000 flashing lights per year and has the capability of producing 100 per day. Setting up the light production costs $50. The cost of each light is $1. The holding cost is $0.10 per light per year. a) What is the optimal size of the production run? b) What is the average holding cost per year? c) What is the average setup cost per year? d) What is the total cost per year, including the cost of the lights? Px

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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EOQ for Production Lots ExerciseA Power Company buys coal from a Coal mine togenerate electricity in rural areas. The Coal minecan supply coal at the rate of 3,500 tons per day for$10.50 per ton. The Power Company uses the coalat a rate of 800 tons per day and operates 365 daysper year. The annual carrying cost for coal is 20%of the acquisition cost, and the ordering cost is$5,000.a) What is the economical production lot size?b) What is the Power Company’s maximuminventory level for coal?
Define Inventory holding?
If EOQ = 289 units, S = $100, and H = $1 per unit per month, what approx. annual demand (D) level would the EOQ model best fit? Pick the closest answer option. 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 3596 units 3540.00 units 5011 units 4510 units
32 Periodic inventory systems may be appropriate for ________________ a. Both small businesses and big companies b. Small businesses c. None of the given options d. Big companies Clear my choice
Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The company operates its production facility 300 days per year. It has orders for about 12,200 flashing lights per year and has the capability of producing 95 per day. Setting up the light production costs $51. The cost of each light is $1.00. The holding cost is $0.15 per light per year. d. What is the total cost per year, including the cost of the lights? (round your response to two decimal places).
Question 30 Store A purchases cases of fertilizer for its lawn-care business from a supplier who charges Store A $30 per order and $50 per case. Each case consists of five bags of fertilizer. Store A needs 2,000 bags of fertilizer a year. Store A's annual holding costs are 30%. If Store A's order quantity is 20 cases, what is its average inventory level? Group of answer choices 10 40 25 20
QUESTION 2a. A manufacturing company Glass Items Manufacturing Limited (GIM), operating under acontinuous review system, has an average demand of 150 units per week for the item it produces.The standard deviation in weekly demand is 30 units. The lead-time for the item is seven weeks,and it costs the company $70 to process each order. The holding cost for each unit is $30 per year.The company operates 52 weeks per year.A normal distribution table is appended to this assignment. (i) Use the information in 2 a. above. What is the desired safety stock level, if the company has apolicy of maintaining a 98% cycle-service level?
26. A small copy center uses five 500-sheet boxes of copy paper a week. Experience suggests thatusage can be well approximated by a normal distribution with a mean of five boxes per week and astandard deviation of one-half box per week. Two weeks are required to fill an order for letterheadstationery. Ordering cost is $2, and annual holding cost is 20 cents per box.a. Determine the economic order quantity, assuming a 52-week year.b. If the copy center reorders when the supply on hand is 12 boxes, compute the risk of a stockout.c. If a fixed interval of seven weeks instead of an ROP is used for reordering, what risk does thecopy center incur that it will run out of stationery before this order arrives if it orders 36 boxeswhen the amount on hand is 12 boxes?
Question 5 Safety Stock Model Consider the following information on an inventory management system (one year is 50 weeks, one year is 365 days and 1 week is 7 days): Item Cost:$10 Order Cost:$250 Annual Holding Cost:33% of item cost Average Demand:515 per week Std. Dev. of Demand:125 per week Lead time:14 days a) Ignoring the uncertainty in the demand (i.e. looking only at average values), find the optimal order quantity and the reorder point. b) Consider now the uncertainty. The order quantity remains the same. If the target is to have a 98% annual service level, what should be the ROP? What is the safety stock? c) If the ROP is 1178 units (note that z value has been changed), what is the corresponding annual service level that the firm can provide?
Westside Auto purchases a component used in the manufacturing of automobile generators directly from the supplier. Westside’s generator production operation, which is operated at a constant rate, will require 1,000 components per month throughout the year (12,000 units annually). Assume that the ordering costs are $25per order, the unit cost is $2.50 per component, and annual holding costs are 20% of the value of the inventory. Eastside has 250 working days per year and a lead time of 10 days. a) What is the EOQ for this component? b) What is the cycle time? c)
Question 4An electronics shop sells 6000 headphones in a year and the sales is relatively constantthroughout the year. These headphones are purchased for SR 20.00 each, and the leadtime is three days. The holding cost per headphone per year is 10% of the unit cost andthe ordering cost per order is SR 75. There are 300 working days per year. Calculate thefollowing:(i) What is the annual holding cost?(ii) In minimizing the cost, how many orders would be made each year?(iii) Given the EOQ, what is the total annual inventory cost (including purchase cost)?(iv) What is the time between orders?(v) What is the ROP?
QUESTION 2a. A manufacturing company Glass Items Manufacturing Limited (GIM), operating under acontinuous review system, has an average demand of 150 units per week for the item it produces.The standard deviation in weekly demand is 30 units. The lead-time for the item is seven weeks,and it costs the company $70 to process each order. The holding cost for each unit is $30 per year.The company operates 52 weeks per year.A normal distribution table is appended to this assignment. (ii) Use the information in 2 a. above. What is the Reorder Point, if the company has a policy ofmaintaining a 98% cycle-service level? Please answer the question above