Smart Products buys 300,000 units of a crucial input per year from a supplier that fulfills its orders within two days of receiving them. Smart Products submits its orders directly to the supplier through a web interface, so its lead time is the supplier’s two day turnaround time. Each order costs Smart Products about $500 to place, while carrying costs are about $60 per unit per year. The company seeks to maintain a five day usage level in a safety stock.
36.What is Smart Product’s economic order quantity (EOQ) for this input?
37.What is Smart Products’s carrying cost at the EOQ?
38.At what inventory level of this input should Smart EOQ reorder?
39.Which would improve Smart Product’s total cost at the EOQ more, a 15% reduction in carrying costs or a 10% reduction in order costs?
a.decreasing order costs decreases total cost by $10,062
b.decreasing order costs decreases total costs by $6,700
c.decreasing carrying costs decreases total costs by $10,062
d.decreasing carrying costs decreases total costs by $6,700
40.Refer to Smart Products. If management determines that a four day safety stock is appropriate for this input, what is the new reorder point?
Sawtooth Industries uses an economic order quantity (EOQ) model to manage its inventory investment. The company uses about 25,000 molded plastic assemblies each year. Order costs for these are $150 per order, while carrying costs are about $250 per unit per year. Assume a 365 day year.
41.What is Sawtooth Industries’ economic order quantity (EOQ) for these parts?
42.Using the EOQ, how many orders will Sawtooth place each year?
43.What is Sawtooth’s total cost at the EOQ?
Amber Mining and Milling, Inc., contracted with Truax Corporation to have constructed a custom-made lathe. The machine was completed and ready for use on January 1, 2013....Jun 23 2020
What factors influence choice of media? What media would you choose to market a new line of cosmetics for women, and why? How would your choice change if it were a cosmet...Nov 07 2017
The given beam in Fig. P9-22 is A992 steel. If the live load is twice the dead load, what is the maximum total service load in k/ft that can be supported when (a) the com...Jul 06 2020
Simple? Simon's Bakery purchases supplies on terms of 1.0 / by 10, net 25. If Simple? Simon's chooses to take the discount? offered, it must obtain a bank loan to meet it...May 29 2020
Suppose an individual invests $10,000 in a load mutual fund for two years. The load fee entails an up-front commission charge of 4 percent of the amount invested and is d...May 10 2020
Suppose that all capital gains are taxed at a 24% rate, and that the dividend tax rate is 38%. Arbuckle Corp. is currently trading for $32 and is about to pay a $4 specia...Jun 09 2021
A debit to Sales Returns and Allowances and a credit to Accounts Receivable recognizes that a customer returned merchandise and/or received an allowance. True or False?May 20 2021
Suppose you make $500monthly deposits into a tax-deferred retirement plan that pays interest at a rate of 10% per year compound quarterly. Suppose that money deposited du...Jul 07 2021
Sat & Co has operated on market machine tools for over 100 years, supplying products to over 100 countries. Its market share geographic distribution included 35% in the U...Jul 13 2021
Adiabatic frictionless compression of an ideal gas, calculate the temperature attained by compressing air, initially at 100°F and 1atm, to 0.1 of its initial volume. It i...Jul 25 2020