Actual order quantity is calculated

Assignment Help Operation Management

Reference no: EM13969123

This is a mail-order business for kitchen equipment. Annual demand for its best seller item is 25,000 units. This best seller item is sold at $350/unit, including shipping and handling. It has an earning markup of 20%. The annual holding cost per unit for this best seller is $5.50. The cost to process an order of this item is $25. It takes ten (10) days to completely process an order. Assume that the year has 360 days.

Question: Can you explain how the Actual Order Quantity (Q) is calculated? Your expert Jimmysiv has provided previous feedback but I have doubts regarding how he reached to Q=300. The EOO for this case is 477.

Reference no: EM13969123

Questions Cloud

Assigning costs to a major project to be undertaken : Suppose that you are the assigning costs to a major project to be undertaken by your firm this year. One particular coding process involves many labor hours, but highly redundant work. The needed information is presented in the table. You have Team A..

Explain pros and cons evolution of genetically engineer food : Pros & Cons The Evolution of Genetically Engineer Food (GE) Through Human Manipulation. How do the authors' views overlap with each other? How and why do the authors' views differ?

Why we are so attracted to outrageous claims : What do you think is the reason why we are so attracted to outrageous claims? Do we have a conspiracy gene

Consider that while chinese and indian immigrants : Consider that while Chinese and Indian immigrants were arriving in the U.S., the British were arriving in China and India. Compare the concept of a 19th century global economy between Asia and the West to the 21st century global economy involving Asi..

Actual order quantity is calculated : This is a mail-order business for kitchen equipment. Annual demand for its best seller item is 25,000 units. This best seller item is sold at $350/unit, including shipping and handling. Can you explain how the Actual Order Quantity (Q) is calculated?..

Stages of the product life cycle : Describe how marketing managers typically manage prices as a product category moves through each of the stages of the Product Life Cycle. (What happens at each stage?)

What are some of the different legal and policy issues : What are some of the different legal and policy issues that managers and leaders face on a daily basis? Discuss the importance of governance in enabling leaders and managers to make the right decision in the right way and for the right reasons. What ..

What is the expected value under perfect information : Audi sells snow tires which are ordered every Friday to meet next week's demand. The sales price for the most popular size is $30 per tire and its cost for Audi is $25. If too many tires are ordered Audi incurs an inventory holding cost of $2 per tir..

Considered as members of reference group-brand community : This case spotlights the phenomenon of Jimmy Buffett fans and their fanatical behavior. Known as Parrot Heads, fans travel long distances to see the artist perform and tailgate for hours before an event. How can Jimmy Buffett fans be considered as me..

User Account

All Pages