Determine the approximate length of cycle

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Reference no: EM132183266

1. A chemical firm produces sodium bisulfate. Demand for this product is 20 tons per day. The capacity for producing the product is 50 tons per day. Setup costs $300, and storage and handling costs are $4 per ton a year. The firm operates 200 days a year.

A. Identify the optimum production run size?

B. Determine the approximate length of a cycle, in days?

C. Determine the approximate length of a production run, in days

D. About how many runs per year would there be?

E. how much is the optimum total cost?

2. A large bakery buys flour in 25 pound bags. The bakery uses an average 1215 bags a year. Preparing an order and receiving a shipment of flour involves a cost of $40 per order. Annual carrying costs are $75 per bag. Answer the following questions.

a. Determine the economic order quantity.

b. What is the average number of bags on hand?

c. How many orders per year will there be?

d. compute the total cost of ordering and carrying flour?

Reference no: EM132183266

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