Techno Gadgets Corp. produces J-Pods, music players that can download thousands of songs. Techno Gadgets forecasts that demand in 2020 will be 19,800 J-Pods. The variable production cost of each J-Pod is $55. In its MRP system, due to the large $17,600 cost per setup, Techno Gadgets plans to produce J-Pods once a month in batches of 1,650 units. The carrying cost of a unit in inventory is $16 per year. Read the requirements LOADING... . Question content area bottom Part 1 Requirement 1. Using the MRP system, what is the annual cost of producing and carrying J-Pods in inventory? (Assume that, on average, half of the units produced in a month are in inventory.) Begin by determining the formula, then calculate the annual cost of producing and carrying J-Pods in inventory, using an MRP system. (Round your answer to the nearest whole dollar.) Cost of producing Total variable production cost + Total setup cost + Carrying cost = and carrying $1,089,000 + $211,200 + $13,200 = $1,313,400 Part 2 Requirement 2. A new manager at Techno Gadgets has suggested that the company use the EOQ model to determine the optimal batch size to produce. (To use the EOQ model, Techno Gadgets needs to treat the setup cost in the same way it would treat ordering cost in a traditional EOQ model.) Determine the optimal batch size and number of batches. Round up the number of batches to the nearest whole number. What would be the annual cost of producing and carrying J-Pods in inventory if it uses the optimal batch size? Compare this cost to the cost calculated in requirement 1. Comment briefly. Begin by selecting the formula used to calculate EOQ. (D=Demand in units for one year, P=Ordering cost per purchase order, C=Carrying cost of one unit in stock, Q=Any order quantity.) ModifyingAbove EOQ equals StartRoot StartFraction 2 DP Over Upper C EndFraction EndRoot With Subscript EOQ=2DPC Part 3 (Round your final answer to the nearest whole number.) The optimal batch size is J-pods.

Techno Gadgets Corp. produces J-Pods, music players that can download thousands of songs. Techno Gadgets forecasts that demand in 2020 will be 19,800 J-Pods. The variable production cost of each J-Pod is $55. In its MRP system, due to the large $17,600 cost per setup, Techno Gadgets plans to produce J-Pods once a month in batches of 1,650 units. The carrying cost of a unit in inventory is $16 per year. Read the requirements LOADING... . Question content area bottom Part 1 Requirement 1. Using the MRP system, what is the annual cost of producing and carrying J-Pods in inventory? (Assume that, on average, half of the units produced in a month are in inventory.) Begin by determining the formula, then calculate the annual cost of producing and carrying J-Pods in inventory, using an MRP system. (Round your answer to the nearest whole dollar.) Cost of producing Total variable production cost + Total setup cost + Carrying cost = and carrying $1,089,000 + $211,200 + $13,200 = $1,313,400 Part 2 Requirement 2. A new manager at Techno Gadgets has suggested that the company use the EOQ model to determine the optimal batch size to produce. (To use the EOQ model, Techno Gadgets needs to treat the setup cost in the same way it would treat ordering cost in a traditional EOQ model.) Determine the optimal batch size and number of batches. Round up the number of batches to the nearest whole number. What would be the annual cost of producing and carrying J-Pods in inventory if it uses the optimal batch size? Compare this cost to the cost calculated in requirement 1. Comment briefly. Begin by selecting the formula used to calculate EOQ. (D=Demand in units for one year, P=Ordering cost per purchase order, C=Carrying cost of one unit in stock, Q=Any order quantity.) ModifyingAbove EOQ equals StartRoot StartFraction 2 DP Over Upper C EndFraction EndRoot With Subscript EOQ=2DPC Part 3 (Round your final answer to the nearest whole number.) The optimal batch size is J-pods.

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Your Question:

Techno Gadgets

Corp. produces J-Pods, music players that can download thousands of songs.

Techno Gadgets

forecasts that demand in

2020

will be

19,800

J-Pods. The variable production cost of each J-Pod is

$55.

In its MRP system, due to the large

$17,600

cost per setup,

Techno Gadgets

plans to produce J-Pods once a month in batches of

1,650

units. The carrying cost of a unit in inventory is

$16

per year.

Read the

requirements

Question content area bottom

Part 1

Requirement 1. Using the MRP system, what is the annual cost of producing and carrying J-Pods in inventory? (Assume that, on average, half of the units produced in a month are in inventory.)

Begin by determining the formula, then calculate the annual cost of producing and carrying J-Pods in inventory, using an

MRP

system. (Round your answer to the nearest whole dollar.)

						Cost of producing
Total variable production cost	+	Total setup cost	+	Carrying cost	=	and carrying
$1,089,000	+	$211,200	+	$13,200	=	$1,313,400

Part 2

Requirement 2. A new manager at

Techno Gadgets

has suggested that the company use the EOQ model to determine the optimal batch size to produce. (To use the EOQ model,

Techno Gadgets

needs to treat the setup cost in the same way it would treat ordering cost in a traditional EOQ model.) Determine the optimal batch size and number of batches. Round up the number of batches to the nearest whole number. What would be the annual cost of producing and carrying J-Pods in inventory if it uses the optimal batch size? Compare this cost to the cost calculated in requirement 1. Comment briefly.

Begin by selecting the formula used to calculate

EOQ.

(D=Demand

in units for one year,

P=Ordering

cost per purchase order,

C=Carrying

cost of one unit in stock,

Q=Any

order quantity.)

ModifyingAbove EOQ equals StartRoot StartFraction 2 DP Over Upper C EndFraction EndRoot With Subscript EOQ=2DPC

Part 3

(Round your final answer to the nearest whole number.)

The optimal batch size is

J-pods.

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