production planning and control Ms Nadhirah opened a souvenir shop which she operates 36 weeks per year. Her top-sellingproduct is an Avenger's mug collection. She able to sales about 10 units per week. Mug'ssupplier charges about RM30.00 per unit. Ordering cost is RM10.00. Annual holding cost is25 percent of a mug's purchased price. As now, she chose a 100-unit per lot size for orderingthe mug.(a) Calculate the cost of saving (2 decimal number) if she planned to use optimum lot sizein her operation.(b) Ms Nadhirah wants to know whether this method is good or not for her operation.Therefore, list up TWO (2) advantages AND TWO (2) disadvantages if she adopts thenew method in her operation.

Given - Weekly demand = 10 units Operating weeks = 36 weeks Ordering cost (S) = RM 10 Item…

Answered: Ms Nadhirah opened a souvenir shop…

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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Custom Computers, Inc. assembles custom home computersystems. Th e heat sinks needed are bought for $12 each and areordered in quantities of 1300 units. Annual demand is 5200 heatsinks, the annual inventory holding cost rate is $3 per unit, andthe cost to place an order is estimated to be $50. Calculate thefollowing:(a) Average inventory level(b) Th e number of orders placed per year(c) Th e total annual inventory holding cost(d) Th e total annual ordering cost(e) Th e total annual cost
The Annual demand of a product is 50000 and ordering cost is 7000 per order and EOQ is 10000 units. At optimum annual inventory, what is the total yearly holding cost?
A product is made-to-stock. Annual demand is 60,000 units. Each unit costs $4.00 and theannual holding cost rate = 25%. Setup cost to produce this product is $300. Determine:1. Economic order quantity and2. Total inventory costs for this situation.
Dave's Sporting Goods sells Mountain Mouse freeze-dried meals. Dave's uses a continuous review system to manage meal inventories. Suppose Mountain Mouse offers the following volume discounts to its customers: 1−950 meals: $6.50 per meal 951 or more meals: $4.50 per meal. Annual demand is 2,900 meals, and the cost to place an order is $23. Suppose the holding cost is $1.50 per meal per year. How many meals should Dave's order at a time? Part 2 Dave's Sporting Goods should order ______ meals at a time to take advantage of the lower cost per unit. (Enter your response rounded to the nearest whole number.)
The National Company uses 150,000 gallons of hydrochloric acid per month. The cost of carrying the chemical in inventory is 50 cents per gallon per year, and the cost of ordering the chemical is P150 per order. The firm uses the chemical at a constant rate throughout the year. What is the total ordering costs if the company will purchase at EOQ level? Format: 1,111.11 The National Company uses 150,000 gallons of hydrochloric acid per month. The cost of carrying the chemical in inventory is 50 cents per gallon per year, and the cost of ordering the chemical is P150 per order. The firm uses the chemical at a constant rate throughout the year. How many days does each order (at the EOQ level) will last? Use 360 days Format: 1
7. Alocal retailer anticipates an annual demand 12000 units of a product. The retailers allows shortages for that product, and these shortages are backordered at a rate of 2 OMR per unit backordered. The cost of ordering is 200 OMR, whereas , the annual holding cost is 1 OMR per unit. The retailer operates 300 days per year. What is the minimum total inventory cost in OMR? Round -up to the nearest integer a. 1998 b. 1550 c. 1789 d. None is correct e. 2000 f. 1987 g. 1898
Rafiki Bar uses 10,000 cases of millet beer monthly. One case costs Shs.5,000. Holding cost is 30% of the cost of a case p.a while ordering cost is Shs.100,000 per order. The firm works 360 days in a year while lead time is 6 days. Required: ii. Determine the days between orders and the reorder point iii. Determine the total cost of the inventory policy iv. Suppose actual holding cost turns out to be 15% instead of 30% and the inventory policy above is implemented for a year, determine the cost of prediction error if every other parameter estimate turns out as predicted.
Sarah’s Organic Soap Company makes organic liquid soaps. She purchases organic Palm oil to make her soaps. She needs 1,000 kgs of Palm oil per day on average. The supplier charges a $60 delivery fee per order (which is independent of the order size). Sarah’s annual holding cost is $1.825 per kg of palm oil. Assume there are 365 days a year. a. What is the daily cost of ordering and holding when EOQ is ordered? b. Again, assume that Sarah needs 1,000 kgs of Palm oil per day. Sarah’s supplier is willing to sell Palm oil to her at a 10% discount on its selling price if she purchases 10,000 kgs at a time. If Sarah takes the offer and orders 10,000 kg at a time, how much will be the resulting daily cost of ordering and holding? (Assume that the fixed cost of ordering is $60 per order and the per unit inventory holding cost is 0.005 per day per kg of Palm oil.) c. Again, assume that Sarah needs 1,000 kgs of Palm oil per day. Sarah’s supplier is willing to sell Palm oil to her at a 10%…
Company XYZ makes bicycles. XYZ produces 400 bicycles a month. They must buy tires from a supplier at a cost of $20 per tire. The inventory holding cost rate is 15% and ordering costs $50 per order. Part i) Let’s assume that there is no shortage inventory allowed. Calculate optimal annual order quantity Calculate annual total inventory cost ^already have the answer for this one. Just input the whole question so it would make more sense. Part ii) Let’s assume that shortage inventory is allowed. With that being said, we know that the shortage cost per unit of item is $5 per year. <<this is the one that I am stuck on. Calculate optimal annual order quantity Calculate annual total inventory cost Hint: Each bicycle has two tires.
Demand for a product is relatively constant at 5 units per day. Lead time for this product is normally distributed with a mean of 20 days and a standard deviation of 4 days. (a) What reorder point provides an 80 percent service level? (b) What reorder point provides a 90 percent service level? (c) If the lead time standard deviation can be reduced from 4 days to 1, what reorder point now provides 90 percent service? How much is safety stock reduced by this change?
32) ABC Shop ABC shop uses glue at a daily rate that is normally distributed with a mean of 250 ounces and a standard deviation of 26 ounces. When the shop places an order for glue it requires 9 days for the order to arrive. What is the Reorder Point if the shop wants an 84% Service Level? Round to an integer value. Group of answer choices a) 2,347 ounces b) 1,538 ounces c) 1,967 ounces d) 2,307 ounces e) 2,327 ounces f) 1,558 ounces
The National Company uses 150,000 gallons of hydrochloric acid per month. The cost of carrying the chemical in inventory is 60 cents per gallon per year, and the cost of ordering the chemical is P150 per order. The firm uses the chemical at a constant rate throughout the year. The chemical's economic order quantity is?

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