minimize the combined ordering and holding costs for staples
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A car rental agency uses 96 boxes of staples a year. The boxes cost $5 each. It costs $10 to order staples, and it costs $0.80 to hold a box of staples in inventory for 1 year.
A.) How many boxes of staples should the car rental company order each time it needs staples, to minimize the combined ordering and holding costs for staples?
B.) Using the order size that minimizes the car rental agency’s combined ordering and holding costs for staples, how long will a single order of staples last the agency, before it must receive more staples? (Assume there are 52 weeks in the year for the car rental agency.)
C.) Using the order size that minimizes the car rental agency’s combined ordering and holding costs for staples, how much does the car rental agency actually spend on holding costs for staples each year?
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- When a retailer places large order of inventory: a. Ordering costs reduces and holding costs increases b. Ordering costs reduces and holding costs decreases c. Ordering costs increases and holding costs increases d. Ordering costs increases and holding costs decreasesIt takes approximately 2 weeks (14 days) for an order of steel bolts to arrive once the order has been placed. The demand for bolts is fairly constant; on the average, the manager, Michelle Wu, has observed that the hardware store sells 500 of these bolts each day. Because the demand is fairly constant, Michelle believes that she can avoid stockouts completely if she orders the bolts at the correct time. What is the reorder point? The reorder point is? units (enter your response as a whole number).Calculate how many of each packet should the store order to maximize the revenue associated with information packets, and what is the store’s expected revenue. WITHOUT EXCEL
- Your company uses an average of 32 boxes of paper a day and operates 128 days a year. It costs $8 to order and receive a shipment of paper, while storage costs for the paper are $1 a year per box. The total annual cost using an order size that would minimize the sum of annual ordering and carrying costs would be $ (enter your answer as a whole number)As the Manager of Branson’s Department Store, you are responsible for ensuring that reorder quantities for the various items have been correctly established. You decide to test one item and choose product Z. A continuous review inventory policy has been used, so you examine this as well as other records and come up with the following data: Cost per unit $35 Holding cost 20 percent of unit cost Average daily demand 10 units Ordering cost $30 per order Standard deviation of daily demand 3 units Delivery lead time 4 days Because customers generally do not wait but go elsewhere, you decide on a service probability of 90 percent. Assume that Branson’s Department Store operates 320 days per year. [What is the annual demand (D)? Determine the optimal order quantity, Q*. Determine the reorder point (R) if demand is constant. Determine the reorder point (R) if demand is varies.Inventory carrying costs differ from inventory holding costs when: A. The item is not moved from one place of the storage area to another.B. The owner of the inventory does not own the warehouse.C. The item is not perishable.D. None of the above
- The company uses 150,000 gallons of alcohol per month. The cost of carrying the alcohol in inventory is P0.50 per gallon per year, and the cost of ordering is P150 per order. The firm uses the alcohol at a constant rate throughout the year. It takes 18 days to receive an order once it is placed. The reorder point is?A large bakery buys flour in 25-pound bags. The bakery uses an average of 1,215 bags a year. Preparing an order and receiving a shipment of flour involves a cost of $10 per order. Annual carrying costs are $75 per bag. a. Determine the economic order quantity. (Round your final answer to the nearest whole number.) Economic order quantity bags b. What is the average number of bags on hand? (Round your final answer to the nearest whole number.) Average number of bags c. How many orders per year will there be? (Round your final answer to the nearest whole number.) Number of orders per year d. Compute the total cost of ordering and carrying flour. (Round your final answer to the nearest whole number. Omit the "$" sign in your response.) Total cost $ e. If annual holding costs were to increase by $9 per bag, how much would that affect the minimum total annual cost? (Round your intermediate calculations to 2 decimal places and final…Charlie’s Pizza orders all of its pepperoni, olives, anchovies, and mozzarella cheese to be shipped directly from Italy. An American distributor stops every four weeks to take orders. Because the orders are shipped directly from Italy, they take three weeks to arrive. Charlie’s Pizza uses an average of 150 pounds of pepperoni each week, with a standard deviation of 30 pounds. Charlie’s prides itself on offering only the best quality ingredientsand a high level of service, so it wants to ensure a 98 percent probability of not stocking out on pepperoni. Assume that the sales representative just walked in the door and there are currently 500 pounds of pepperoni in the walk-in cooler. How many pounds of pepperoni would you order? (Answer in Appendix D)
- Southeastern Bell stocks a certain switch connector at its central warehouse for supplying field service offices. The yearly demand for these connectors is 15,000 units. Southeastern estimates its annual holding cost for this item to be $24 per unit. The cost to place and process an order from the supplier is $73. The company operates 300 days per year, and the lead time to receive an order from the supplier is 3 working days.Paul’s Toy Distributor (PTD) sells 200 game consoles every week. PTD charges a $300 fixed cost for every delivery. PTD’s annual inventory holding cost is $45 per console. Assume that there are 52 weeks a year. Assume that PTD orders 1000 game consoles at a time. What is the average amount of time the consoles stay as PTD’s inventory before being sold? Find the closest answer.The principal goal of inventory management systems is to balance the costs of ordering, shipping, and receiving goods with the cost of carrying those goods, while simultaneously meeting the firm's policy with respect to avoiding running short of stock and disrupting production schedules. True False