Eight Flags operates several amusement parks in the Midwest. The company stocks machine oil to service the machinery for the many rides at the parks. EightFlags needs 30,000 gallons (D) of oil annually; the parks operate 50 weeks a year. Management is unsatisfied with the current supplier of oil and has obtained twobids from other suppliers. The data are contained in the following table.Annual Freight CostsShipping Quantity (Q)Price/Unit Annual Holding Lead Time (L) Annual AdministrativeSupplierSharpsWinkler5,000$5.200$5.40015,000$3.500$3.500Cost/Unit (H)$0.76$0.8010,000(p)$3.80(wks)Cost$5,000$4,000$3.800$3,800$4.003Which supplier and which shipping quantity will provide the lowest costs for Eight Flags?UsingV and a shipping quantity ofis the lowest cost alternative, with annual total costs to Eight Flags of $. (Enter your response as an integer.)

Freight charges or freight rates are other terms for freight costs. It is the fee paid to a carrier…

Eight Flags operates several amusement parks in the Midwest. The company stocks machine oil to service the machinery for the many rides at the parks. Eight Flags needs 30,000 gallons (D) of oil annually; the parks operate 50 weeks a year. Management is unsatisfied with the current supplier of oil and has obtained two bids from other suppliers. The data are contained in the following table. Annual Freight Costs Shipping Quantity (Q) Supplier Sharps Winkler 5,000 $5.200 $5.400 Price/Unit Annual Holding Lead Time (L) Annual Administrative (p) $3.80 $4.00 Cost/Unit (H) $0.76 $0.80 10.000 15,000 $3.500 $3,500 Cost $5.000 $4,000 (wks) $3,800 $3.800 3 Which supplier and which shipping quantity will provide the lowest costs for Eight Flags? Using and a shipping quantity of is the lowest cost alternative, with annual total costs to Eight Flags of S (Enter your response as an integer.)

Eight Flags operates several amusement parks in the Midwest. The company stocks machine oil to service the machinery for the many rides at the parks. Eight Flags needs 30,000 gallons (D) of oil annually; the parks operate 50 weeks a year. Management is unsatisfied with the current supplier of oil and has obtained two bids from other suppliers. The data are contained in the following table. Annual Freight Costs Shipping Quantity (Q) Supplier Sharps Winkler 5,000 $5.200 $5.400 Price/Unit Annual Holding Lead Time (L) Annual Administrative (p) $3.80 $4.00 Cost/Unit (H) $0.76 $0.80 10.000 15,000 $3.500 $3,500 Cost $5.000 $4,000 (wks) $3,800 $3.800 3 Which supplier and which shipping quantity will provide the lowest costs for Eight Flags? Using and a shipping quantity of is the lowest cost alternative, with annual total costs to Eight Flags of S (Enter your response as an integer.)

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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