2. A toy manufacturer uses 48,000 rubber wheels per year for its dump truck. The trucks are assembled over the entire year. The firm makes its own wheels at a rate of P800 per day and makes them in batches/lots. The holding cost is P1 per wheel per year. Setup cost is P45 per order. The firm operates 240 days per year. a. How many wheels should they make at a time? b. How much is the demand rate per day? c. How much is the POQ? d. How much is the total inventory cost? e. What is the length of the production run?

2. A toy manufacturer uses 48,000 rubber wheels per year for its dump truck. The trucks are assembled over the entire year. The firm makes its own wheels at a rate of P800 per day and makes them in batches/lots. The holding cost is P1 per wheel per year. Setup cost is P45 per order. The firm operates 240 days per year. a. How many wheels should they make at a time? b. How much is the demand rate per day? c. How much is the POQ? d. How much is the total inventory cost? e. What is the length of the production run?

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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The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.
Assume that Palmer Executive Pens uses 1,440,000 gallons of ink each year. Further, assume that Palmer can order the ink at a cost of $2 per gallon plus fixed ordering costs of $125 per order. The firm’s carrying cost is 20 percent of the inventory value, at cost. A. How much is the holding cost? B. How much is the ordering cost? C. How many number of orders are there in a year?
Race One Motors is an Indonesian car manufacturer. Atits largest manufacturing facility, in Jakarta, the company producessubcomponents at a rate of 300 per day, and it uses these subcomponentsat a rate of 12,500 per year (of250 working days). Holding costsare $2 per item per year, and orde1ing (setup) costs are $30 per order.a) What is the economic production quantity?b) How many production runs per year will be made?c) What will be the maximum inventory level?d) What percentage of time will the facility be producing components?e) What is the annual cost of ordering and holding inventory?
A large bakery buys sugar in 50-kg bags. The bakery uses an average of 1,344 bagsa year. Preparing an order and receiving a shipment of sugar involves a cost of P 135.Annual carrying costs are P 630 per bag. The bakery operates 280 days per year.Lead time = 2 weeks.a. Determine the economic order quantity.b. What is the average number of bags on hand?c. When should the bakery order for more sugar?d. How many times per year will the bakery order for sugar?
1. A service station uses 2500 oil filters during the course of a year, and this usage is constant throughout the year. These oil filters are purchased from a supplier 100 miles away for $15 each, and the lead time is 2 days. The holding cost per oil filter per year is $1.50 (or 10% of the unit cost) and the ordering cost is $18.75. There are 250 working days per year. a) the manager decided to change its inventory control model to a fixed time model, with the same lead time of 2 days and placing orders every 2 weeks, with the suppliers. Average daily demand remains at 10 and the standard deviation is 2.5. Currently there are 700 units of inventory on hand. What size orders should he place with suppliers?
Yellow Press, Inc., buys paper in 1,500-pound rolls for print-ing. Annual demand is 2,500 rolls. The cost per roll is $800,and the annual holding cost is 15 percent of the cost. Eachorder costs $50 to process.a. How many rolls should Yellow Press, Inc., order at a time?b. What is the time between orders?
Al Fursan Inc. needs 300 kgs of a material per month (four weeks). It costs RO 10 to make and receive an order, and it takes 16 workdays to receive it. The annual holding cost is 15 % of purchase price. The price RO1 per kg. The company is operating 6 days per week. What is the expected time (in days) between order? Round-up to the nearest integer Select one: a. 55 b. 53 c. 207 d. 105 e. 58
A microbrewery purchases malt for production. The supplier charges $35 for delivery (no matter how much is delivered) and $1.20 per gallon. Annual holding cost is 35% of the price per gallon. Usage is 250 gallons/week. d) If order quantity is 2500 gallons, what is the sum of the ordering and holding costs PER GALLON? e) If orders are for EOQ amount, what is the annual cost of the inventory system as a percentage of the annual purchase cost?
Yellow Press, Inc., buys paper in 1,500-pound rolls for printing. Annual demand is 3,000 rolls. The cost per roll is $1,000, and the annual holding cost is 28 percent of the cost. Each order costs $75. Part 2 a. How many rolls should Yellow Press order at a time? Yellow Press should order enter your response here rolls at a time. (Enter your response rounded to the nearest whole number.) Part 3 b. What is the time between orders? (Assume 200 workdays per year.) The time between orders is enter your response here days. (Enter your response rounded to one decimal place.)
One-Eyed Toad Pottery makes custom planters for up-scaleclients. The average demand for planters is 20 per week.One-Eyed Toad’s production facility has the capacity to make25 planters per week. Setup cost is $1500. The value of finishedgoods inventory is $250 per planter. The annual per-unitinventory holding cost is 35 percent of the item’s value.a. What is the economic production lot size (ELS)?b. What is the average time between orders (TBO)?c. What is the total of the annual holding cost and setupcost?
Babble, Inc., buys 400 blank cassette tapes per month for use in producing foreign language courseware. The ordering cost is $12.50. Holding cost is $0.12 per cassette per year. a. How many tapes should Babble, Inc., order at a time? b. What is the time between orders?
Intan Store sells 240,000 cabinets per year. Based on the company's policy, a safety stock of 4 percent from yearly sales is to be maintained. The carrying cost is RM0.60 per unit annually and the ordering costs are RM150.00. The delivery time is 10 days. Order should be placed in multiple of 100 units. i. Compute the economic order quantity (assume 360 days per year). ii. Compute the total inventory cost. iii. Compute the reorder inventory level. iv. Compute the average inventory. Please answer only part 4