2- A drug distribution company wants to determine the most appropriate stock policy for burn cream, one of its stock items. The demand for burn cream is 24 thousand boxes per year and it is assumed to occur at a constant rate. A box of burn cream costs "X" USD. There is a total cost of 20% of the unit cost, 12% of which is capital, 8% of which is insurance, tax, warehouse general expenses, for the possession of drugs. It has been calculated that 38 USD costs are incurred each time for ordering from pharmaceutical manufacturers. The company works 360 days a year. According to this information, for the distribution company; a) What should be the economic order size? b) How many times a year does he have to order? c) How many days will it take between two orders? d) What is the sum of the inventory costs in USD?

2- A drug distribution company wants to determine the most appropriate stock policy for burn cream, one of its stock items. The demand for burn cream is 24 thousand boxes per year and it is assumed to occur at a constant rate. A box of burn cream costs "X" USD. There is a total cost of 20% of the unit cost, 12% of which is capital, 8% of which is insurance, tax, warehouse general expenses, for the possession of drugs. It has been calculated that 38 USD costs are incurred each time for ordering from pharmaceutical manufacturers. The company works 360 days a year. According to this information, for the distribution company; a) What should be the economic order size? b) How many times a year does he have to order? c) How many days will it take between two orders? d) What is the sum of the inventory costs in USD?

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Description: 2- A drug distribution company wants to determine the most appropriatestock policy for burn cream, one of its stock items. The demand for burncream is 24 thousand boxes per year and it is assumed to occur at aconstant rate. A box of burn cream costs

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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