The NATO 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

The NATO 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

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 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?
A big box store sells a lawn mower. Annual demand for the lawn mower is 600 units. The ordering cost per order of lawnmowers is $20. The annual holding cost per unit is $15. Assuming the store uses the EOQ as the order size, what would be the total annual ordering cost for the lawnmower? PLEASE WRITE ONLY THE TOTAL ORDERING COST WITHOUT $ sign in the box below.
The company uses 150,000 gallons of alcohol per month. The cost of carrying the alcohol in inventory is P0.50 per gallon per year, and the cost of ordering is P150 per order. The firm uses the alcohol at a constant rate throughout the year. It takes 18 days to receive an order once it is placed. The reorder point is?
the company expects to sell 19,200 units next year. it operates 360 days a year. annual carrying cost is P32 per unit ordering cost is P150. A. what is the length of an order cycle in days? (4 decimals) B. what is the total annual cost at EOQ? show solution
The XYZ Company has an annual sale of 20,000 television sets. each inventory item has a value of P2,500.00. Ordering cost is P500.00 per order. Carrying cost is 25% of average value. Find the following: a. Optimal number of order per year b. Economic order quantity c. Annual carrying cost d. Annual Ordering cost e. Total annual inventory cost
A small local pharmacy, Tacky Pharm sells self-test kits for diabetic patients. These kits cost Tacky $15 each. Customers want to buy the kits at a rate of 240 per week. The pharmacy operates 52 weeks per year. Tacky Pharm estimates ordering cost at $50. Annual holding costs are 20 percent of the unit cost. Lead time is 2 weeks. Using the information given Calculate the economic order quantity. Calculate the total annual costs using the EOQ. Determine the reorder point.
company sells 20,000 radios evenly throughout the year. The cost of carrying one unit of inventory for one year is P8, and thepurchase order cost per order is P32. What is the economic orderquantity
the company expects to sell 19,200 units next year. it operates 360 days a year. annual carrying cost is P32 per unit ordering cost is P150. A. what is the EOQ? (round up) B. how many times per year does the store reorder?(round up) show solution
the company expects to sell 38,400 units next year. it operates 355 days a year. annual carrying cost is P64 per unit ordering cost is P300 A. what is the eoq? B. how many times per year does the store reorder? (round up) show solution
Rapallo Sneakers, Inc. sells a pair of LG sneakers for $42. Due to the recent fitness craze, these shoes are in high demand: 52 pairs of shoes are sold per week. The ordering cost is $42 per order, and the annual holding cost is 25 percent of the selling price. If the store operates 48 weeks a year, what can you say about the size of the current order quantity of 225 pairs?
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
A pharmacist wants to establish an optimal inventory policy for a new antibiotic that requires refrigeration in storage. The pharmacist expects to sell 6000 packages of this antibiotic at a steady rate during the next year. She plans to place several orders of the same size spaced equally throughout the year. The ordering cost for each delivery is $15, and carrying costs, based on the average number of packages in inventory, amount to $8 per year for one package. Use this information to answer the following questions. a) Let x be the order quantity and r the number of orders placed during the year. Find the inventory cost (ordering cost plus carrying cost) in terms of x and r. b) Find the constraint function. c) Determine the economic order quantity that minimizes the inventory cost and then find the minimum inventory cost. X=__________ C=$___________