How Tyler should plan on ordering the flour for his bakery. Based on the attached:How much should Tyler plan on ordering the flour for his bakery?When should Tyler order the flour for his bakery Tyler decided to open a bakery because everyone he knew told him that his baked goodswere "out of this world." He had a little bit of a business school background because he gothis Bachelor's from SPS at UIW recently. He remembered his teacher telling him thatinventory models can be used for both the raw materials as well as the finished products for abusiness like his. So, he decided to see if he could use the basic EOQ model for identifyinghow much quantity to order of raw materials such as eggs, flour, sugar, etc. To get started, hedecided to create a model for flour based on the information he had on hand regardingpotential costs as follows:• Usage per month 100 Ibs.• Purchase cost $1 per Ib.Order cost $10.00 per order sentAnnual Holding Rate 10% of purchase price per Ib.• 52-week year 300 working days per year• Lead time 2 daysFill in the following table based on this information:# Optimal Inventory PolicyAnswerТуре1 Economic Order Quantity Q*Annual Inventory Holding Cost H490Ibs.224.5dollarsAnnual Ordering Cost O24.48dollars1248.99 dollarsTotal Annual Cost TC5 Maximum Inventory Level Q6 Average Inventory Level Q/24490Ibs.245Ibs.Ibs.7Reorder Point r8leftNumber of Orders Per Year8 (D/Q*)9 Cycle Time (Days) T2.45122.47days

EOQ or Economic ordering quantity indicating a model of ordering an item based on the consideration…

Answered: ow much should Tyler plan on ordering…

Business

Operations Management

ow much should Tyler plan on ordering the flour for his bakery? When should Tyler order the flour for his bakery

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...

See similar textbooks

Similar questions

Tyler decided to open a bakery because everyone he knew told him that his baked goods were “out of this world.” He had a little bit of a business school background because he got his Bachelor’s from SPS at UIW recently. He remembered his teacher telling him that inventory models can be used for both the raw materials as well as the finished products for a business like his. So, he decided to see if he could use the basic EOQ model for identifying how much quantity to order of raw materials such as eggs, flour, sugar, etc. To get started, he decided to create a model for flour based on the information he had on hand regarding potential costs as follows: Usage per month 100 lbs Purchase cost $1 per lb. Order cost $10.00 per order sent Annual Holding Rate 10% of purchase price per lb. 52-week year 300 working days per year Lead time 2 days Write a sentence explaining how Tyler should plan on ordering the flour for his bakery: how much to order and when to order (from the first…
XYZ Inc. needs 400 kgs of a material per month. It costs OMR 100 to make and receive an order, and it takes 12 workdays to receive it. The annual holding cost is 15 % of purchase price. The price OMR 1 per kg. The company is operating workdays per week in a 52-week year. At what level of inventory in Kgs should the company be placing orders ? Round-up to the nearest integer
Pls do fast within 5 minutes and i will give like for sure Solution must be in typed form Taylor Supply is a wholesaler of office supplies and equipment. Taylor purchases cartons of staples from Barker Manufacturing. Barker offers a price of $7 per carton of staples. Taylor incurs a fixed charge of $90 per order to cover order equipment and clerical costs. Each order takes 3 days to arrive . Taylor has projected sales to be 603 boxes per day. Taylor's accounting department has determined the holding costs relevant for inventory decisions are 28% of unit cost. Assume Q=3000. What is the demand for staples during lead time? 1) Assume Q=3000. What is the demand for staples during lead time? 2) Assume Q=3000. What z value is associated with a 90% confidence level? 3) Assume Q=3000. If Taylor wants a 90% service level, and the standard deviation in daily demand is 250, what is the appropriate reorder point? 4) Assume Q=3000. If Taylor wants to improve their service level to 95%, and…
Your firm uses a continuous review system and operates 52 weeks per year. One of the SKUs has the following characteristics.Demand 1D2 = 20,000 units/yearOrdering cost 1S2 = $40/orderHolding cost 1H2 = $2/unit/yearLead time 1L2 = 2 weeksCycle@service level = 95 percentDemand is normally distributed, with a standard deviation of weekly demand of 100 units.Current on-hand inventory is 1,040 units, with no scheduled receipts and no backorders.a. Calculate the item’s EOQ. What is the average time, in weeks, between orders?b. Find the safety stock and reorder point that provide a 95 percent cycle-service level.
The basic EOQ model is based on all the following assumptions except: A. Annual demand is known and constant.B. The item is always available when needed.C. Estimates of ordering and carrying costs are accurate.D. Order is instantaneously received exactly when previous inventory has just been used up.
The basic EOQ model is based on all the following assumptions except: * A. Annual demand is known and constant.B. The item is always available when needed.C.Estimates of ordering and carrying costs are accurate.D.Order is instantaneously received exactly when previous inventory has just been used up.
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.
EE Co has calculated the following in relation to its inventories.Buffer inventory level 60 unitsReorder size 250 itemsFixed order costs $40 per orderCost of holding onto one item pa $1.5 per yearAnnual demand 10,000 itemsPurchase price $2 per itemWhat is the total inventory related costs for a year (to the nearest whole $)?
Alpha Products, Inc., is having a problem trying to control inventory. There is insufficient time to devote to all its items equally. The following is a sample of some items stocked, along with the annual usage of each item expressed in dollar volume. ITEM ANNUAL DOLLAR USAGE ITEM ANNUAL DOLLAR USAGE a S 30, 100 k S 1,700 b 27,000 120,000 c 93,000 m 111,000 d 1,400 n 3,000 e 1,800 o 500 f 30,000 p 114, 000 g 1,600 q 2,600 h 2,500 г 28,000 i 3, 200 s 2, 800 j 1,500 t 3, 100 a. Suggest a system for allocating control time? multiple choice ABC analysis Cycle counting b. Specify where each item from the list would be placed.
Red Corporation uses the reorder point modelto plan its purchases. It sellsitssole productat the following daily amounts:Minimum=30,000; Average=40,000;Maximum=60,000. Its supplier takes 3 dayson average and 4 days maximum to deliverthe order. The-reorder point would be A. 240,000B. 160,000C. 120,000D. 90,000
Consider a product with a daily demand of 500 units, a setup cost per production run of $100, a daily holding cost per unit of $0.20, and an annual production rate of 219,000 units. The firm operates and experiences demand 365 days per year. Suppose that management mistakenly used the basic EOQ model to calculate the batch size instead of using the production order quantity model. How much money per year has that mistake cost the company?
XYZ has developed the following data from its Material A Safety stock 280 Average (normally) daily use 200 Maximum daily use 240 Minimum daily use 180 EOQ 1,000 Cost of placing an order P20 Working days per year 250 days Lead time 6 days What is the reorder point? What is the absolute maximum inventory? What is the normal maximum inventory? What is the cost of carrying an inventory per unit per year? What is the cost of carrying an inventory per unit per year?