A company that markets hypodermic needles to hospitals. The company purchases the needles from a supplier. The annual demand is 6,603 needles. The annual setup (or ordering) cost is $31 per order and the inventory holding cost per unit per year is $11.35. The company operates 293 days a year. Calculate the optimal annual holding cost for the company. Use at least 4 decimal places.

A company that markets hypodermic needles to hospitals. The company purchases the needles from a supplier. The annual demand is 6,603 needles. The annual setup (or ordering) cost is $31 per order and the inventory holding cost per unit per year is $11.35. The company operates 293 days a year. Calculate the optimal annual holding cost for the company. Use at least 4 decimal places.

Name: A company that markets hypodermic needles to hospitals. The company pu
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Description: A company that markets hypodermic needles to hospitals. The company purchases the needles from a supplier. The annual demand is 6,603 needles. The annual setup (or ordering) cost is $31 per order and the inventory holding cost per unit per year is $1

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.
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your company is facing the situation in which the demand is stochastic but the lead time is known with certainty. Your company has recently implemented a periodic review policy in which your inventory is reviewed every 30 days. The demand is normally distributed with a mean of 600 items annually. The lead time is 25 days, and the annual standard deviation is 100 units. Inventory shows 20 parts in stock. Your company has a policy of 90% service level type I. Also, ordering cost in $20 and holding cost is also $20 per item per year. a) find the order quantity for the next period b) how would your answer change if service level is defined as the expected number of parts available from stock.