An electronic manufacturer in San Francisco receives its motherboards from a supplier in Hong Kong. The lead time for orders is 3 weeks. One of their board costs $16 per unit and the holding cost for this board is $0.5 per week. They manage their inventory to achieve a 97 percent in-stock probability. Weekly demand is for 150 boards with a standard deviation of 200. Use the following table when needed: In-stock probability 99% 98% 97% 96% |Z value 2.33 2.05 1.88 |1.75 a. How many boards do they have on on order on average? boards b.How many boards do they have on hand on average? boards c.For this board what is the total holding cost incurred per week? per week
Q: A product is ordered once each year, and the reorder point without safety stock (dL) is 100 units.…
A: Safety Stock Safety stock is a concept used to describe a degree of additional stock held to…
Q: Weekly demand for Lego at a Wal-Mart store is normally distributed with a mean of 2,500 boxes and a…
A:
Q: Bads, Inc., sells an average of 1,000 food processors each year. Each order for foodprocessors…
A: Given that: Annual Demand, D = 1000 Lead Time, LT = 1 month Standard Deviation, σ = 69.82 Service…
Q: A grocer carries 9,300 different items in their store. In a normal week, demand occurs for 4,900 of…
A: Given- Retailer carries the item in a store= 9300 items Weekly demand = 4900 items
Q: A grocer purchases plums for $2.95 per pound and sells them for $4.62 per pound. At the end of the…
A:
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One…
A: THE ANSWER IS AS BELOW:
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A:
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A: Given data; Carrying cost 10 $ per kilo per year Stockout cost 75 $ per kilo Reorder point…
Q: In a business setting operating under demand uncertainty with an average annual demand of 500 and a…
A: Note: We are allowed to do one question only at a time. Safety stock is the buffer inventory that…
Q: A firm uses the order-up-to model to manage its inventory. It wants to increase its…
A: Holding cost - These are the inventories that remain unsold. The cost is comprised of total…
Q: Long last Appliance Store has a demand of 1300 units per month for one of its fast selling portable…
A: Find the given details below: Given details Demand 1300 Units/Month Annual Demand (D) 15600…
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One…
A: THE ANSWER IS AS BELOW:
Q: Demand each period is normally distributed and an order-up-to model is used to decideorder…
A: Correct answer is (g) I,II,III
Q: Lia ITZY has determined that the annual demand for number 6 screws is 100,000 screws. Lia, who works…
A: Given data is Annual demand(D) = 100,000 Order cost(S) = $10 Holding cost = 0.5(0.01) = $0.005
Q: DETERMINING SAFETY STOCK WITH PROBABILISTIC DEMAND AND CONSTANT LEAD TIMEDavid Rivera Optical has…
A: Given Reorder point = 50 units Carrying cost = $5 per frame per year Stockout cost = $40 per frame
Q: A golf specialty wholesaler operates 50 weeks per year. Management is trying to determine an…
A: Formula:
Q: A retailer carries 10,000 items in its store. During the week, there is some demand for 6000 of the…
A: The stockout probability is the likelihood that the insufficient or inadequate inventory is…
Q: Lia ITZY has determined that the annual demand for number 6 screws is 100,000 screws. Lia, who works…
A: The detailed solution is given in Step 2.
Q: A company stocks an item that is consumed at the rate of 30 units each day. Every time an order is…
A: Economic order quantity is the optimal quantity that the business needs to buy the inventory to…
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A: Given data; Carrying cost 15 $ per kilo per year Stockout cost 70 $ per kilo Reorder point…
Q: Kids’ toys makes an order once each year an the reorder point, without safety stock, is 200 toys.…
A: Given data: Reorder point without safety stock is 200 toys Holding cost (H)= $5 Cost of stock-out…
Q: Cindy and Mindy were in the same student group while studying for their MBA at UTD. They graduated…
A: Since Cindy knows that Mindy learned only the EOQ model during her MBA, Cindy safely assumes that…
Q: An electronic manufacturer in San Francisco receives its motherboards from a supplier in Hong Kong.…
A: Given data Lead time (LT) = 3 weeks Cost = $19 Holding cost (H) = $0.6 per week Service level =…
Q: OfficePro sells calculators at a rate of 3 per day. When the company places an order from its…
A: Given: Selling rate = 3 per day Optimal order size = 80 units not > 10% chances of out of stock…
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One…
A: Given data: Monthly average demand, d = 290 Standard deviation of monthly demand, s = 75 Annual…
Q: The home appliance department in a large department store is using a (Q, R) system to control the…
A: Given data: Radios selling each week = 12 Weekly demand of normal distribution ,variance = 30…
Q: Given this information: Expected demand during lead time = 300 units Standard deviation of lead time…
A: The reorder point refers to the point at which an organization realizes the inventory drop at some…
Q: Marigold Corp. sells 2,750 dim-night bulbs per year, and places orders for 670 of these bulbs at a…
A: To calculate the safety stock,first have to calculate no: of order Marigold estimates a 60% chance…
Q: Henrique Correa's bakery prepares all its cakesbetween 4 A.M. and 6 A.M. so they will be fresh when…
A: Given that: Mean demand (d) = 25 Standard deviation (s) = 4 Cost of a cake (c) = $6 Selling price…
Q: Open the A2 Liquor Company Excel file. Make the following changes: The profit for beer has increased…
A: Note: - Since the data of the excel file is not given for the first question, we will answer the…
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One…
A: Lot size-reorder point system is one of the multi period models. This system is denoted by decision…
Q: You are the owner of Hotspices.com, an online retailer of hip, exotic, and hard-to-findspices.…
A: Project management schedule contains a list of a project related activities and deliverables,…
Q: The home appliance department of a large department store is using inventory models to control the…
A: Given that: Daily demand = 150 Number of days in year = 365 Ordering cost(S)= $28 Item cost(C) =…
Q: Jam costs $10/jar, requires a 6mo. lead time, and Will sell for $35/jar. If you stock out, you'll…
A: EOQ stands for Economic Order Quantity. It is a measurement used in the field of Operations,…
Q: The Fast Service Food Mart stocks frozen pizzas in a refrigerated display case. The average daily…
A: Economic order quantity is calculated for taking decisions with respect to Fixed demand and variable…
Q: Children's art sets are ordered twice each year by KINGSWAY Company and the reorder point, without…
A: Demand and lead-time are called random variables. The inventory can be divided into two categories:…
Q: Suppose that the manager of a construction supply house determined from historical recordsthat…
A: Average Demand during lead time (DLT) = 50 tons Mean (M) = 50 tons Standard deviation (SD) = 5 tons…
Q: Given this information:Expected demand during lead time = 300 unitsStandard deviation of lead time…
A:
Q: The demand faced by CBA company each week is estimated to be normally distributed with a mean of…
A:
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores One…
A: Given data, Monthly average demand, d = 280Stdev of monthly demand, s = 70Annual demand, D = 280*12…
Q: A large automobile repair shop installs about 1,250 mufflers per year, 18 percent of which are for…
A: Consider the following values given in the question: = total demand per year = 1,250…
Q: An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One…
A: Given data Ordering cost = $100 per order Monthly demand (D) = 300 Lead time = 5 days Monthly…
Q: A distributor of computer monitors purchases the monitors from an overseas supplier under a…
A: The target inventory level needed to achieve a 90% service level will be the safety stock required…
Q: The manager of Alaina's Garden Center must make the annual purchasing plans for rakes, gloves, and…
A: Forecasting is a process of predicting the future demand based on past available information. Here,…
Q: An online footwear firm Shoe-n-co has four regional warehouses. Demand at each warehouse is normally…
A: Given, Average weekly demand, AVG = 10000 Standard deviation, STD= 2000 Service level, α =1-5% =95%…
Q: A firm experiences demand with a mean of 100 units perday. Lead time demand is normally distributed,…
A: Calculation of Annual cost of Holding safety stock Thus, the given value is E(X) = 1000Standard…
Q: A department store uses a (Q, R) policy to control its inventories. Sales of a pocket FM…
A: Given data, Sales of pocket FM radio average is 1.4 radio per week. Radio Cost of the stores =…
Q: Nationwide Auto Parts uses a periodic review inventory control system for one of its stock items.…
A: Average weekly demand (d) = 100 units Standard deviation of weekly demand (d) = 20 units Review…
Q: A firm experiences demand with a mean of 100 units per day. Lead time demand is normally distributed…
A: Daily Demand = 100 units per day Mean = 1000 units Standard Deviation = 200 units Holding Cost = H =…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- Assume the demand for a companys drug Wozac during the current year is 50,000, and assume demand will grow at 5% a year. If the company builds a plant that can produce x units of Wozac per year, it will cost 16x. Each unit of Wozac is sold for 3. Each unit of Wozac produced incurs a variable production cost of 0.20. It costs 0.40 per year to operate a unit of capacity. Determine how large a Wozac plant the company should build to maximize its expected profit over the next 10 years.In Problem 12 of the previous section, suppose that the demand for cars is normally distributed with mean 100 and standard deviation 15. Use @RISK to determine the best order quantityin this case, the one with the largest mean profit. Using the statistics and/or graphs from @RISK, discuss whether this order quantity would be considered best by the car dealer. (The point is that a decision maker can use more than just mean profit in making a decision.)The home appliance department of a large department store is using inventory models to controlthe replenishment of a particular model of Microwave ovens. The daily demand follows anormal distribution with a mean of 150 units and standard deviation of 16 units. The store pays$100 for each oven. Fixed costs of replenishment are $28. The accounting departmentrecommends a 20% annual holding cost rate. Assume that the average lead time is 5 days with astandard deviation of 1 day. Assume 365 days a year.Part A: What is the EOQ?Part B: What is the reorder point if the maximum chance of 5% of stock out (i.e. 95% servicelevel) is desired?Part C: What is the reorder point if a fill rate of 99% is required?Part D: Suppose management wants to simplify the process by setting the reorder point to“1000” units. Based on this policy, what is the implied chance of stock out?
- Annual demand for number 2 pencils at the campus store is normally distributed with mean 1,000 and standard deviation 250. The store purchases the pencils for 6 cents each and sells them for 20 cents each. There is a two-month lead time from the initiation to the receipt of an order. The store accountant estimates that the cost in employee time for performing the necessary paperwork to initiate and receive an order is $20, and recommends a 22 percent annual interest rate for determining holding cost. The cost of a stock-out is the cost of lost profit plus an additional 20 cents per pencil, which represents the cost of loss of goodwill. Consider the problem of satisfying the demand for number 2 pencils faced by the campus store mentioned above.a. Re-solve the problem, substituting a Type 1 service level criterion of 95 percent for the stock-out cost.b. Re-solve the problem, substituting a Type 2 service level criterion of 95 percent for the stock-out cost. Assume that Q is given by the…An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One particular part, a popular brand of oil filter, is purchased by the warehouse for $1.50 each. It is estimated that the cost of order processing and reciept is a $100 per order. The company uses an inventory carrying charge based on 28 percent annual interest rate. The monthly demand for the filters follows a normal distribution with mean 280 and a standard deviation 77. Order lead time is assumed to be 5 months. Assume that if a filter is demanded when the warehouse is out of stock, then the demand is back-ordered and the cost assessed for each back-ordered demand is $12.80. Determine the following quantities: a. The optimal values of the order quantity and the reorder level. b. The average annual cost of holding, setup, and stock-out associated with this item assuming that an optimal policy is used. c. Evaluate the cost of uncertanity for this process. That is, compare the average annual cost…A golf specialty wholesaler operates 50 weeks per year. Management is trying to determine an inventory policy for its 1-irons, which have the following characteristics:Demand 1D2 = 2,000 units/yearDemand is normally distributedStandard deviation of weekly demand = 3 unitsOrdering cost = $40/orderAnnual holding cost 1H2 = $5/unitsDesired cycle@service level = 90 percentLead time 1L2 = 4 weeksa. If the company uses a periodic review system, what should P and T be? Round P to the nearest week.b. If the company uses a continuous review system, what should R be?
- An automotive warehouse stocks a variety of parts that are sold at neighborhood stores. One particular part, a popular brand of oil filter, is purchased by the warehouse for $1.50 each. It is estimated that the cost of order processing and receipt is $100 per order. The company uses an inventory carrying charge based on a 25 percent annual interest rate. The monthly demand for the filter follows a normal distribution with mean 290 and standard deviation 75. Order lead time is assumed to be five months. Assume that if a filter is demanded when the warehouse is out of stock, then the demand is back-ordered, and the cost assessed for each back-ordered demand is $12.80. With Type 2 Service objective of 95 percent. Find the optimal values of (Q, R). Q= R=The lead time demand for bathing suits is governed bythe discrete random variable shown in Table 11. Thecompany sells an average of 10,400 suits per year. The costof placing an order for bathing suits is $30, and the cost ofholding one bathing suit in inventory for a year is $3. Thestockout cost is $3 per bathing suit. Use marginal analysisto determine the optimal order quantity and the reorderpoint.Lead TimeDemand Probability180 .30190 .30200 .15210 .10220 .15A grocer purchases plums for $2.95 per pound and sells them for $4.62 per pound. At the end of the sales cycle, leftover plums are sold for a closeout price of $1.76 per pound. The grocer purchases 10,380 pounds of plums. Expected demand is normally distributed with a mean of 8,304 pounds and a standard deviation of 1,038. What is the grocer's expected profit?
- Annual demand for number 2 pencils at the campus store is normallydistributed with mean 1,000 and standard deviation 250. The store purchases the pencils for 6 cents each and sells them for 20 cents each. There is a two-month lead time from the initiation to the receipt of an order. The store accountant estimates that the cost in employee time for performing the necessary paperwork to initiate and receive an order is $20, and recommends a 22 percent annual interest rate for determining holding cost. The cost of a stock-out is the cost of lost profit plus an additional 20 cents per pencil, which represents the cost of loss of goodwill.a. Find the optimal value of the reorder point R assuming that the lot size used is the EOQ.b. Find the simultaneous optimal values of Q and R.c. Compare the average annual holding, setup, and stock-out costs of the policies determined in parts (a) and (b).d. What is the safety stock for this item at the optimal solution?Please do not give solution in image format thanku Deltic sells this component for 55 per unit with a 4-month delivery lead time. Assume Deltic covers all transportation and related processing until delivery. TCX’s demand forecast for the upcoming selling season (12 months) is a normal distribution with mean 13500 and standard deviation 3736,4 . TCX sells each unit, after integrating their proprietary software, for 135. Assume that TCX uses a holding cost rate of 25 %, and any leftover units can be sold for 30 on average. Due to the long lead time and high minimum order quantity required, TCX is planning on a single order from Deltic to meet their needs in the next year. How many of these components should TCX order? Calculate the resulting expected annual profits for TCX.The home appliance department in a large department store is using a (Q, R) system to control the replenishment of a model of FM radio. The store sells an average of 12 radios each week. Weekly demand follows a normal distribution with variance 30. (Assume that there are 52 weeks in a year.) The store pays $20 for each radio, which it sells for $85. Fixed order cost is $30 per order. The accounting department recommends a 20% interest rate for the cost of capital. Storage costs are 3% and breakage 2% of the purchasing cost of each item. If a customer demands the radio when it is out of stock, the customer will generally go elsewhere. Loss-of-goodwill costs are estimated to be about $25 per radio. Order lead time is 13 weeks. (The penalty cost includes loss of profit and loss of goodwill.) Find the optimal values of (Q, R) based on the penalty cost. What are the values for Q and R if the stock-out cost is replaced with a 95% Type 1 service level?