The optimal order quantity. Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

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Answer 1

Question

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

b)

Summary Introduction

To determine: The annual holding cost.

c)

Summary Introduction

To determine: The annual setup cost.

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

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The catering manager of La Vista Hotel, LisaFerguson, is disturbed by the amount of silverware she is losing every week. Last Friday night, when her crew tried to set up for a banquet for 500 people, they did not have enoughknives. She decides she needs to order some more silverware,but wants to take advantage of any quantity discounts hervendor will offer.For a small order (2,000 or fewer pieces), her vendorquotes a price of $1.80Ypiece.If she orders 2,001–5,000 pieces, the price drops to$1.60Ypiece. 5,001–10,000 pieces brings the price to$1.40Ypiece, and 10,001 and above reduces the price to $1.25.Lisa’s order costs are $200 per order, her annual holdingcosts are 5%, and the annual demand is 45,000 pieces. For thebest option:a) What is the optimal order quantity?b) What is the annual holding cost?c) What is the annual ordering (setup) cost?d) What are the annual costs of the silverware itself with anoptimal order quantity?e) What is the total annual cost, including ordering,…

The catering manager of LaVista Hotel, Lisa Ferguson, is disturbed by the amount of silverware she is losing every week. Last Friday night, when her crew tried to set up for a banquet for 500 people, they did not have enough knives. She decides she needs to order some more silverware, but wants to take advantage of any quantity discounts her vendor will offer. ≻For a small order (2,000 pieces or less) her vendor quotes a price of $1.80/piece. ≻If she orders 2,001 to 5,000 pieces, the price drops to $1.60/piece. ≻5,001 to 10,000 pieces brings the price to $1.40/piece, and ≻10,001 and above reduces the price to $1.25/piece. Lisa's order costs are $205 per order, her annual holding costs are 5%, and the annual demand is 45,100 pieces. For the best option (the best option is the price level that results in an EOQ within the acceptable range): Part 2 a) What is the optimum ordering quantity? enter your response here units (round your response to the…

The catering manager of LaVista Hotel, Lisa Ferguson, is disturbed by the amount of silverware she is losing every week. Last Friday night, when her crew tried to set up for a banquet for 500 people, they did not have enough knives. She decides she needs to order some more silverware, but wants to take advantage of any quantity discounts her vendor will offer. ≻For a small order (2,000 pieces or less) her vendor quotes a price of $1.80/piece. ≻If she orders 2,001 to 5,000 pieces, the price drops to $1.60/piece. ≻5,001 to 10,000 pieces brings the price to $1.40/piece, and ≻10,001 and above reduces the price to $1.25/piece. Lisa's order costs are $200.00 per order, her annual holding costs are 5%, and the annual demand is 15,000 pieces. For the best option (the best option is the price level that results in an EOQ within the acceptable range): Part 2 a) What is the optimum ordering quantity? ________ units (round your response to the nearest whole…

Answer 2

Question

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

b)

Summary Introduction

To determine: The annual holding cost.

c)

Summary Introduction

To determine: The annual setup cost.

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

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Answer 3

Question

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

b)

Summary Introduction

To determine: The annual holding cost.

c)

Summary Introduction

To determine: The annual setup cost.

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

Expert Solution & Answer

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Answer 4

Question

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

b)

Summary Introduction

To determine: The annual holding cost.

c)

Summary Introduction

To determine: The annual setup cost.

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

Expert Solution & Answer

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Answer 5

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

b)

Summary Introduction

To determine: The annual holding cost.

c)

Summary Introduction

To determine: The annual setup cost.

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

Answer 6

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

Answer 7

Chapter 12, Problem 24P

a)

Summary Introduction

To determine: The optimal order quantity.

Introduction: Inventory management is the process of ordering, storing and using inventory of the company such raw material, components and finished goods. It governs the flow of goods from manufacturers to warehouse and to the point of sale. The key function is to maintain record of flow of new or returned products which enters or leaves the company.

Answer 8

b)

Summary Introduction

To determine: The annual holding cost.

Answer 9

b)

Summary Introduction

To determine: The annual holding cost.

Answer 10

c)

Summary Introduction

To determine: The annual setup cost.

Answer 11

c)

Summary Introduction

To determine: The annual setup cost.

Answer 12

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

Answer 13

d)

Summary Introduction

To determine: The annual cost of silverware with optimal order quantity.

Answer 14

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

Answer 15

e)

Summary Introduction

To determine: The total annual cost including ordering, holding and purchasing the silverware.

Answer 16

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Answer 17

Expert Solution & Answer

Answer 18

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Answer 19

Ch. 12 - Ethical Dilemma Wayne Hills Hospital in tiny...Ch. 12 - Prob. 1DQ Ch. 12 - Prob. 2DQ Ch. 12 - What is the purpose of the ABC classification...Ch. 12 - Prob. 4DQ Ch. 12 - Explain the major assumptions of the basic EOQ...Ch. 12 - Prob. 6DQ Ch. 12 - Prob. 7DQ Ch. 12 - Prob. 8DQ Ch. 12 - What impact does a decrease in setup time hive on...

Solution Summary: The author explains that inventory management is the process of ordering, storing and using inventory of the company such raw material, components, and finished goods.

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To determine: The annual holding cost.

To determine: The annual setup cost.

To determine: The annual cost of silverware with optimal order quantity.

To determine: The total annual cost including ordering, holding and purchasing the silverware.

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Chapter 12 Solutions