Firelands Electronics purchases certain electronic components at $10 per unit from asupplier and resell them for a profit. The cost of handling each purchase order is about$50 per order, and the inventory cost per unit is 20% of the purchase cost plus $0.40for insurance per year. It takes about 6 working days for each order to be delivered tothe store. Based on past sales record, they can sell about 1445 units evenly everymonth. The store is open 300 days every year.(а)Determine the EOQ.(b)Find the annual holding cost at the EOQ.(c)Find the inventory size at which the store should reorder.(d)How many days are in between two consecutive order placements?(e)Produce a graph detailing the inventory change in time and reordering point.

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Answered: Firelands Electronics purchases certain…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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