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- Based on an EOQ-type ordering criterion, what costmust be taken to zero if the desire is to have an orderquantity of a single unit?Enter the formulas in the template. The numeric answers are to the right. Quantity Discount Template (Detailed Documentation) Discount Quantity Min. 1 50 90 125 150 200 Price 1,400 1,100 900 895 890 885 Demand = Carrying cost = Ordering cost = EOQ = Average Inventory Order per year = Total Cost = Quantity Ordered $200.00 $190.00 2,500 Total Cost Order Cost Order Cost (D/Q* Ordering Cost) Carry Cost Carry Cost (Q/2* Carrying Cost) Purchase Cost (D* Price) Quantity Discount Template (Detailed Documentation) Discount Quantity Min. 1 50 90 125 150 200 Price 1,400 1,100 900 895 890 885 Demand = Carrying cost = Ordering cost = EOQ = Average Inventory Order per year = Total Cost = Quantity Ordered 72.5 72.5 90.0 125.0 150.0 200.0 $200.00 $190.00 2,500 72.5 36.3 2.8 $13,784.05 Order Cost $6,892 Total Cost $ 293,784.05 $ 233,784.05 $ 194, 105.56 $ 194,875.00 $ $ 198,500.00 $2,500.00 Order Cost (D/Q* Ordering Cost) $6,892.02 $6,892.02 $5,555.56 $4,000.00 195,583.33 $3,333.33 Carry Cost $6,892…Given the following information, compute the economic order quantity, annual holding cost, annual order cost, and annual total inventory cost. Annual requirements (R) = 50,000 units Order cost (S) = $150 per order Holding rate (k) = 15% Unit cost (C) = $100 per unit
- Annual demand (D) for an item is 1,000 units. Ordering Cost (S) is $100 per order. Holding cost (H) is $5 per unit per year. Find economic order quantity (Q*). 400 units 141.4 units 200 units 40,000 units 100 unitsDiscuss what is meant by ABC analysis of inventory.Name several measures that can determine ABCstatusUse ABC analysis to determine the items deserving mostattention and tightest inventory control
- Discount-Mart, a major East Coast retailer, wants todetermine the economic order quantity (see Chapter 12 for EOQformulas) for its halogen lamps. It currently buys all halogenlamps from Specialty Lighting Manufacturers in Atlanta. Annualdemand is 2,000 lamps, ordering cost per order is $30, and annualcarrying cost per lamp is $12. a) What is the EOQ?b) What are the total annual costs of holding and ordering(managing) this inventory?c) How many orders should Discount-Mart place with SpecialtyLighting per year?Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 97,200 units per year, an ordering cost of $4 per order, and carrying costs of $1.50 per unit. What is the economic ordering quantity? How many orders will be placed during the year? What will the average inventory be? What is the total cost of ordering and carrying inventory?David’s Delicatessen flies in Hebrew National salamis regularly to satisfy a growing demand for the salamis in Silicon Valley. The owner, David Gold, estimatesthat the demand for the salamis is pretty steady at 175 per month. The salamis costGold $1.85 each. The fixed cost of calling his brother in New York and having thesalamis flown in is $200. It takes three weeks to receive an order. Gold’s accountant, Irving Wu, recommends an annual cost of capital of 22 percent, a cost of shelfspace of 3 percent of the value of the item, and a cost of 2 percent of the value fortaxes and insurance.b. How many salamis should Gold have on hand when he phones his brother tosend another shipment?
- example 15.1 Economic Order Quantity and Reorder Point Find the eco- nomic order quantity and the reorder point, given Annual demand (D) = 1,000 units Average daily demand (d) = 1,000/365 Ordering cost (S)= $5 per order Holding cost (H) = $1.25 per unit per year Lead time (L) = 5 days Cost per unit (C) = $12.50 %3D %3D %3D What quantity should be ordered?David’s Delicatessen flies in Hebrew National salamis regularly to satisfy a growing demand for the salamis in Silicon Valley. The owner, David Gold, estimatesthat the demand for the salamis is pretty steady at 175 per month. The salamis costGold $1.85 each. The fixed cost of calling his brother in New York and having thesalamis flown in is $200. It takes three weeks to receive an order. Gold’s accountant, Irving Wu, recommends an annual cost of capital of 22 percent, a cost of shelfspace of 3 percent of the value of the item, and a cost of 2 percent of the value fortaxes and insurance.c. Suppose that the salamis sell for $3 each. Are these salamis a profitable itemfor Gold? If so, what annual profit can he expect to realize from this item?(Assume that he operates the system optimally.)David’s Delicatessen flies in Hebrew National salamis regularly to satisfy a growing demand for the salamis in Silicon Valley. The owner, David Gold, estimatesthat the demand for the salamis is pretty steady at 175 per month. The salamis costGold $1.85 each. The fixed cost of calling his brother in New York and having thesalamis flown in is $200. It takes three weeks to receive an order. Gold’s accountant, Irving Wu, recommends an annual cost of capital of 22 percent, a cost of shelfspace of 3 percent of the value of the item, and a cost of 2 percent of the value fortaxes and insurance.a. How many salamis should Gold have flown in and how often should he orderthem?