Customers at Joe’s Office Supply Store demand anaverage of 6,000 desks per year. Each time an order isplaced, an ordering cost of $300 is incurred. The annualholding cost for a single desk is 25% of the $200 cost of adesk. One week elapses between the placement of an orderand the arrival of the order. In parts (a)–(d), assume that noshortages are allowed.a Each time an order is placed, how many desks shouldbe ordered?b How many orders should be placed each year? c Determine the total annual costs (excluding purchas-ing costs) of meeting the customers’ demands for desks. d Determine the reorder point. If the lead time werefive weeks, what would be the reorder point? (52 weeksone year.)e How would the answers to parts (a) and (b) changeif shortages were allowed and a cost of $80 is incurredif Joe’s is short one desk for one year?
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Customers at Joe’s Office Supply Store demand an
average of 6,000 desks per year. Each time an order is
placed, an ordering cost of $300 is incurred. The annual
holding cost for a single desk is 25% of the $200 cost of a
desk. One week elapses between the placement of an order
and the arrival of the order. In parts (a)–(d), assume that no
shortages are allowed.
a Each time an order is placed, how many desks should
be ordered?
b How many orders should be placed each year?
c Determine the total annual costs (excluding purchas-
ing costs) of meeting the customers’ demands for desks.
d Determine the reorder point. If the lead time were
five weeks, what would be the reorder point? (52 weeks
one year.)
e How would the answers to parts (a) and (b) change
if shortages were allowed and a cost of $80 is incurred
if Joe’s is short one desk for one year?
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