Conclude the optimal order quantity also reorder point

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Reference no: EM1377365

Q. Anderson Supply Organization sells windows also French doors. Its most popular French Door model is a six foot unit which it purchases from Marvel doors. The units cost Anderson $500 each also sell for $700 each. Anderson uses a 22% annual holding cost rate also the cost of placing an order with Marvel for the doors is $200. If Anderson runs out of stock of doors it estimates which it incurs a good will cost of $15 per unit for each week a consumer must wait for the door. The fixed administrative cost to process a backorder is estimated to be $5. Anderson sells an average of 30 units per week also the lead time for delivery of the doors is approximately two weeks.

A. Conclude the optimal order quantity also reorder point for the doors.

B. Approximately illustrate what percentage of consumers will have to wait for their units?

Reference no: EM1377365

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