Calculate the optimum ordering quantity for this item

Assignment Help Business Management
Reference no: EM131209044

You are in charge of inventory control of a highly successful product retailed by your firm. Weekly demand for this item varies, with an average of 200 units and a standard deviation of 16 units. It is purchased from a wholesaler at a cost of Rs. 12.50 per unit. The supply lead time is 4 weeks. Placing an order costs Rs. 50 and the inventory carrying cost is 20% of the item's cost per year. Assume you operate for 52 weeks in a year.

a. Calculate the optimum ordering quantity for this item?

b. How many units of the item should be maintained as safety stock for 99% protection against stock outs during an order cycle?

c. If the ordering methodology is carried out after every 2 weeks, calculate the safety stock that would be required to maintain against stock outs and compare the same with part (b) above.

d. Calculate the number of turns of inventory in both the cases of (b) and (c).

Reference no: EM131209044

Questions Cloud

How many bytes/s can be read from a 2-cm-wide tape : Suppose a particular magnetic tape can be formatted with eight tracks per centimeter of tape width. The recording density is 200 bits/cm, and the transport mechanism moves the tape past the read heads at a velocity of 25 cm/s. How many bytes/s can..
How many bits are required for the memory data register : How many bits are required for the memory data register?
How many control lines do you need if a bus is used : How many control lines do you need to connect each register to all other registers?
Make a t flip-flop from this flip-flop : Assume that there is a flip-flop with the characteristic given in Figure P14.13, where A and B are the inputs to the flip-flop and Q is the next state output. Using necessary logic gates, make a T flip-flop from this flip-flop.v
Calculate the optimum ordering quantity for this item : The supply lead time is 4 weeks. Placing an order costs Rs. 50 and the inventory carrying cost is 20% of the item's cost per year. Assume you operate for 52 weeks in a year. Calculate the optimum ordering quantity for this item?
How many flip-flops would be required : A binary pulse counter can be constructed by interconnecting T -type flip-flops in an appropriate manner. Assume it is desired to construct a counter which can count up to 10010.
Write a literature review using the articles : Bus 701 Literature Review Assignment. Task: Write a literature review using the articles provided on Moodle, You must use at least three of the journal articles given on moodle, You don't have to use all of the journal articles
Explain what the circuit does : The input to the circuit of Figure P14.1 is a square wave having a period of 2 s, maximum value of 5 V, and minimum value of 0 V. Assume all flip-flops are initially in the RESET state.
Is our security better this year than last year : It is not difficult to intercept wireless signals and, depending on the protocol, extract security information. An on-going court case against Google is deciding whether it is an invasion of privacy for Google Streetview cars to collect wireless p..

Reviews

Write a Review

Business Management Questions & Answers

  Explain marketing communication mix

Define "marketing communication mix." Marketing communication mix uses five promotional tools. Identify and explain each tool. As the marketing consultant, explain how you would apply each promotional tool to promote Aquafina. Be creative - use ex..

  Implement performance management dashboards

What are the key steps to successfully implementing performance management dashboards in your organization

  Explain japanese firms perceive a stronger positive

Explain Japanese firms perceive a stronger positive association between trust and commitment in intercultural

  Self-evaluation your leadership philosophy1what is the role

self-evaluation your leadership philosophy1.what is the role of leadership within your organization or one that i know

  Current supplier for a part

According to the eNotes, if a company does not have a current supplier for a part, they must issue a(n) _______ so their potential supplier can provide a detailed quote that might include more than just a per unit price, it may also include del..

  How much profit can you earn in four hours

Suppose you can spend your time doing two things - producing beach balls or going to the beach. (That is, you havetwo mutually-exclusive alternatives.) Suppose you can produce a beach ball at a cost of $1 per ball and you can producetwo balls per ..

  Controlling function of management

Discuss why does the controlling function of management have a negative connotation and explain how do we make it a positive event?

  What legal protections would be advantageous for new busines

What legal protections would be advantageous for the new business to pursue? Why?

  Explain what type of marketing research your company need

Explain what type of marketing research your company will need to use in order to support its marketing strategy

  Strategic management and competitiveness

In current market conditions, companies need to gain and then maintain a competitive edge over their competitors. They do this by employing a compelling and dynamic strategic management process to create a strategy that helps them achieve their go..

  Demand for service delivery with decreasing budgets

In today's challenging economic environment, how does the Public Safety administrator balance the continuing demand for service delivery with decreasing budgets?

  Dual-core approach management vs technology

Explain the dual-core approach. How does the process of management change normally differ from technology change and discuss

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd