The extra holding cost incurred by adding ‘Q’ units. Inventory and supply chain models: The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

Question

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Answer 1

Question

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

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Students have asked these similar questions

The best quantity to order One of the formulas for inventorymanagement says that the average weekly cost of ordering, payingfor, and holding merchandise iswhere q is the quantity you order when things run low (shoes,TVs, brooms, or whatever the item might be); k is the cost ofplacing an order (the same, no matter how often you order); c isthe cost of one item (a constant); m is the number of items soldeach week (a constant); and h is the weekly holding cost per item(a constant that takes into account things such as space, utilities,insurance, and security). Find dA>dq and d2A>dq2.

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

Torrance Refinery produces approximately 23.1 Million barrels of gasoline per year. A California distributor sources its gasoline from the Torrance refinery. The annual demand for gasoline at the California distributor is 5.3 Million barrels. The cost of storing gasoline is approximately $29 per barrel (per year). The cost of placing an order to the Torrance refinery (including shipping) is $7300 per order. Orders will be received gradually instead of delivered all at once (hence EPQ). At what quantity will the total cost of procurement be the lowest? Round your answer to the nearest whole number. Do NOT include a comma. For example, answer like 103542 and NOT 103,542 Answer: 58845 Check

Answer 2

Question

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Expert Solution & Answer

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Answer 3

Question

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Expert Solution & Answer

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Answer 4

Question

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Expert Solution & Answer

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Answer 5

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Answer 6

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

Answer 7

Chapter 12, Problem 63P

a)

Summary Introduction

To determine: The extra holding cost incurred by adding ‘Q’ units.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

Answer 8

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

Answer 9

b)

Summary Introduction

To determine: The save in purchase costs by ordering ‘Q’ units.

Answer 10

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

Answer 11

c)

Summary Introduction

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

Answer 12

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Answer 13

d)

Summary Introduction

To determine: The order size should be made by the company before the price increases go into the effect.

Answer 14

Expert Solution & Answer

Answer 15

Expert Solution & Answer

Answer 16

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Answer 17

Ch. 12.4 - Prob. 1P Ch. 12.4 - Prob. 2P Ch. 12.4 - Prob. 3P Ch. 12.4 - Prob. 4P Ch. 12.4 - Prob. 5P Ch. 12.4 - Prob. 6P Ch. 12.4 - Prob. 7P Ch. 12.4 - Prob. 8P Ch. 12.4 - Prob. 9P Ch. 12.4 - Prob. 10P

Solution Summary: The author explains the functions of inventory and supply chain as one of the most important business decisions for an organization.

Concept explainers

To determine: The save in purchase costs by ordering ‘Q’ units.

To determine: The value of ‘Q’ maximizing the purchase cost saving less the extra holding costs.

To determine: The order size should be made by the company before the price increases go into the effect.

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Chapter 12 Solutions