9. Given the following data: Period 1 2 3 4 5 6 7 8 9 80 Gross Requirements 70 30 90 30 80 20 90 60 The beginning inventory is O and there are no scheduled receipts. The order cost is $90 and the holding cost is $1 per part per period. (a) What are the order costs, carrying costs, and totals cost over the 9 periods using the lot-for-lot size rule? (b) What are the order costs, carrying costs, and totals cost over the 9 periods using the fixed order quantity rule with FOQ = 100? (c) What are the order costs, carrying costs, and totals cost over the 9 periods using the period order quantity rule with POQ = 3?

9. Given the following data: Period 1 2 3 4 5 6 7 8 9 80 Gross Requirements 70 30 90 30 80 20 90 60 The beginning inventory is O and there are no scheduled receipts. The order cost is $90 and the holding cost is $1 per part per period. (a) What are the order costs, carrying costs, and totals cost over the 9 periods using the lot-for-lot size rule? (b) What are the order costs, carrying costs, and totals cost over the 9 periods using the fixed order quantity rule with FOQ = 100? (c) What are the order costs, carrying costs, and totals cost over the 9 periods using the period order quantity rule with POQ = 3?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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Abey Kuruvilla, of Parkside Plumbing, uses 1,200 of a certain spare part that costs $25 for each order, with an annual holding cost of $24. a) Calculate the total cost for order sizes of 25, 40, 50, 60, and 100. b) Identify the economic order quantity and consider the implications for making an error in calculating economic order quantity.
Q2) Clancy's Motors has the folowing demand to meet for custom manufactured fuel injector parts. The holding cost for that item is $2 per month and each setup costs $80. Lead time is 0 months. Cakulate the planned order rekases using: (a) the EOQ technique, and (b) the POQ technique. And What are the costs of each plan, including the hokling cost of any inventory kft over affer month 7? What technique performance is better. Month Requirement 400 | 150 | 200 150 2 | 3 | 4 | 5 | 6 150 | 250 100 Answer: (a) The monthly hokling cost = $2/month Average monthly demand = ??? units The EOQ = ??? units Total inventory hekl = ??? units Setup costs = $??? Hokling cost = $???? Total cost = $???? (b) POQ Interval = ?.??, round to # month. Total inventory hekl = ? units Setup costs = $??? Hokling cost = $? Total cost = $???
Question 1 For supply item ABC, Andrews Company has been ordering 400 units per week. A new purchasing agent has been hired by the company who wants to start using the economic-order- quantity method and its supporting decision elements. She has gathered the following information: Annual demand in units Lead time, in days Ordering costs Insurance and handling costs Purchase price per unit Return on cash investment 20,800 5 $22 $7 $15 15% Required
William Bevi lle's computer training school, inRichmond, stocks workbooks with the following characteristics:Demand D = 19,500 units/ yearOrdering costS = $25/ orderHolding cost H = $4/ unitjyeara) Calculate the EOQ for the workbooks.b) What are the annual holding costs for the workbooks?c) What are the annual ordering costs?
What is the relationship of the economic order quantityto demand? To the holding cost? To the setup cost?
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?
4. (Inventory Management - Part 2) An item has a unit purchase cost of $50, and an inventory-carrying rate per period of 0.02. The additional data for this product is given below: Period Demand (units) Fixed Cost (S/order) (i) (ii) 1 75 100 2 0 110 3 65 100 Assuming no backordering is allowed, answer the followings: (a) Check whether the demand is lumpy or not. (b) Apply the following heuristics on the problem given above. Period Order Quantity 4 40 105 5 90 100 Silver-Meal (iii) Part-Period Balancing (c) Which of the solutions obtained in part (b) do you select? (d) Draw a network diagram to illustrate the given lot sizing problem, and calculate the cost values for each are on the network. (e) Apply the Wagner-Whitin algorithm to determine the optimal order quantities, the optimal inventory levels, and the minimum sum of the ordering and inventory carrying costs.
Answer the following activity: 1. Assume that the following quantity discount schedule is appropriate. If annual demand is 120 units, ordering costs are $20 per order, and the annual holding cost rate is 25%, what order quantity would you recommend? Order Size O to 49 50 to 99 100 or more Discount (%) Unit Cost $30.00 $28.50 $27.00 5 10
A manufacturing company produces two products X and Y. Each product X requires one A and two Bs. Each B requires one C and one D. Each product Y requires 1 C and 4Ds. Table Q5A shows data from the inventory records of components. Table Q5A Data category A B C D Lot - sizing rule Fixed order quantity = 250 Lot for lot Lot for lot Fixed order quantity = 1000 Lead time 3 weeks 2 weeks 1 week 2 weeks Beginning inventory 70 0 200 800 The MPS for products X and Y is given in Table Q5B. The on-hand inventories are as follows: X = 100, Y = 30. The only scheduled receipts are 250 units of X in period 2.The lead times are as follows: X = 2 weeks, Y = 3 weeks. The chase strategy is used for both products. Table Q5B Demand in period Product SS 1 2 3 4 5 6 7 8 X 50 300 200 250 Y 30 400 Required: a) Draw a product structure tree for each product. b) Develop…
hipra Sharma B >> Unit cost (S) 20 O O 8 65% 46 min 06 secs
A large law firm uses an average of 40 boxes of copier paper a day. The firm operates 260 days ayear. Storage and handling costs for the paper are $30 a year per box, and it costs approximately$60 to order and receive a shipment of paper. a. What order size would minimize the sum of annual ordering and carrying costs?b. Compute the total annual cost using your order size from part a.c. Except for rounding, are annual ordering and carrying costs always equal at the EOQ?d. The office manager is currently using an order size of 200 boxes. The partners of the firmexpect the office to be managed “in a cost-efficient manner.” Would you recommend that theoffice manager use the optimal order size instead of 200 boxes? Justify your answer.
A large law firm uses an average of 40 boxes of copier paper a day. The firm operates 260 days ayear. Storage and handling costs for the paper are $30 a year per box, and it costs approximately$60 to order and receive a shipment of paper.a. What order size would minimize the sum of annual ordering and carrying costs?b. Compute the total annual cost using your order size from part a.c. Except for rounding, are annual ordering and carrying costs always equal at the EOQ?d. The office manager is currently using an order size of 200 boxes. The partners of the firmexpect the office to be managed “in a cost-efficient manner.” Would you recommend that theoffice manager use the optimal order size instead of 200 boxes? Justify your answer.