OPERATION MANAGEMENT
2nd Edition
ISBN: 9781260242423
Author: CACHON
Publisher: MCG
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Chapter 10, Problem 17PA
Summary Introduction
To determine: The inventory holding cost.
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Yellow Press, Inc., buys paper in 1,500-pound rolls for printing. Annual demand is 2, 750 rolls. The cost per roll is 500$, and the annual holding cost is 28percent of the cost. Each order costs 45$. Part 2 a. How many rolls should Yellow Press order at a time? Yellow Press should order enter your response here rolls at a time. (Enter your response rounded to the nearest whole number.)
Which of the following is an element of inventory holding costs?
All of these are elements of inventory holding costs.
investment costs
housing costs
material handling costs
pilferage, scrap, and obsolescence
Please do not give solution in image format thanku
A small mail-order company uses 14,000 boxes a year. Holding cost rate is 18 percent of unit cost per year, and ordering cost is $33 per order. The following quantity discounts are available.
Number of Boxes Price per Box 1,000 to 1,999 $1.15 2,000 to 4,999 1.10 5,000 to 9,999 1.05 10,000 or more 1.00
a. Determine the optimal order quantity.
Optimal order quantity boxes
b. Determine the number of orders per year. (Round the final answer to 1 decimal place.)
No. of orders per year
Chapter 10 Solutions
OPERATION MANAGEMENT
Ch. 10 - It is costly to hold inventory, but inventory can...Ch. 10 - A delivery truck from a food wholesaler has just...Ch. 10 - Prob. 3CQCh. 10 - Prob. 4CQCh. 10 - Prob. 5CQCh. 10 - Prob. 6CQCh. 10 - Prob. 7CQCh. 10 - Prob. 8CQCh. 10 - Prob. 9CQCh. 10 - Prob. 10CQ
Ch. 10 - Prob. 11CQCh. 10 - Prob. 12CQCh. 10 - Prob. 13CQCh. 10 - Prob. 14CQCh. 10 - Prob. 1PACh. 10 - Prob. 2PACh. 10 - Prob. 3PACh. 10 - An electronics manufacturer has 25 days-of-supply...Ch. 10 - Prob. 5PACh. 10 - Prob. 6PACh. 10 - Prob. 7PACh. 10 - Prob. 8PACh. 10 - Prob. 9PACh. 10 - Prob. 10PACh. 10 - Prob. 11PACh. 10 - Prob. 12PACh. 10 - A retailer has annual sales of 500,000 and an...Ch. 10 - An online shoe retailers annual cost of holding...Ch. 10 - Prob. 15PACh. 10 - Prob. 16PACh. 10 - Prob. 17PACh. 10 - Prob. 18PACh. 10 - Prob. 19PACh. 10 - Prob. 1CCh. 10 - Prob. 3CCh. 10 - Prob. 4C
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- When a retailer places large order of inventory: a. Ordering costs reduces and holding costs increases b. Ordering costs reduces and holding costs decreases c. Ordering costs increases and holding costs increases d. Ordering costs increases and holding costs decreasesarrow_forwardwhich of the following is NOT a carrying inventory select one a.all of these b.caital costs c.purchase cost d.storage cost e.none of thesearrow_forwardCalculate how many of each packet should the store order to maximize the revenue associated with information packets, and what is the store’s expected revenue. WITHOUT EXCELarrow_forward
- All of the following statements concerning shortage costs are true Except: Shortage costs include loss of goodwill, loss of a sale, loss of a customer, loss of profits, and late penalties Shortage costs are difficult or impossible to measure with any accuracy High shortage costs favor small inventories It is the cost of having no items in the inventory when it is needed by customersarrow_forwardIs proper cost of storage is necessary? 1-True 2-Falsearrow_forwardA local bookstore turns over its inventory once every three months. The bookstore’sannual cost of holding inventory is 36 percent. What is the inventory holding cost (in $)for a book that the bookstore purchases for $10 and sells for $18?arrow_forward
- Which one of the following represent FIFO method of inventory evaluation? a. Old merchandise is sold first b. Average number of goods are sold c. Old items remain in inventory d. New merchandise is sold firstarrow_forwardIn the A-B-C classification system, items which account for sixty percent of the total dollar-volume for few inventory items would be classified as: O a) A items b) B items c) C items d) e) B items plus C items A items plus B itemsarrow_forwardThe total stockout cost = $ enter your response here. (Enter your response as a whole number.)arrow_forward
- what is an example of a latent demandarrow_forwardIn inventory management, high holding costs calls for high inventory levels. A.True B.Falsearrow_forwardThat One Book sells its books through The Witch and the Wardrobe bookstores. It costs That One Book $0.80 to print each book; it sells the book to The Witch and the Wardrobe for $2.50. The Witch and the Wardrobe then sells the books at retail for $6.00. Whatever doesn’t sell gets thrown away. Demand for the book each issue is normal with a mean of 5219 and a standard deviation of 1610. To give The Witch and the Wardrobe incentive to order more books, it proposes a revenue-sharing contract. Instead of selling the book to The Witch and the Wardrobe for $2.50, That One Book will sell its books to The Witch and the Wardrobe for only $1.00. However, for each book that The Witch and the Wardrobe sells at retail, The Witch and the Wardrobe must give $2.00 back to That One Book. With this revenue sharing agreement in place, what is the optimal order amount that will maximize The Witch and the Wardrobe expected profit? Please do fast ASAParrow_forward
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