How much should the forward buy on polystyrene be

Assignment Help Operation Management

Reference no: EM132289585

SPC buys polystyrene resin from a supplier in 1000-pound units, and each unit costs $20, and the percent holding cost is 10%. The fixed shipping cost per order is $300. If we assume that 1000 pounds of resin yield 1000 pounds of clear plastic, what are the following values for clear plastic?

Annual demand is 20,240,800 pounds

A) lot size per shipment to minimize total cost

B) economic order quantity (EOQ)

C) number of shipments/year for polystyrene resin in order to meet the forecasted demand for clear plastic in 2007xxx

D) cycle inventory

E) cycle inventory holding cost

F) replenish cycle time

G) average flow time

If the supplier offers a promotional short term discount of 25% per unit at the beginning of the year, what is the optimal order quantity and how much should the forward buy on polystyrene be?

Show working,

Reference no: EM132289585

Questions Cloud

External analysis for apple : Complete an EFE matrix with at least 20 key external factors. Complete a CPM with at least 7 critical success factors

Important to examine analytics in context of business goals : Explain why it is important to examine analytics in the context of business goals, objectives, and KPIs.

Simple moving average-weighted moving average : Simple Moving Average (SMA), Weighted Moving Average (WMA) and Exponential Smoothing (ES) are three quantitative methods of forecasting.

Investigate problem of negative social impact : Investigate a problem of negative social impact using information/various concepts covered in Business Communication.

How much should the forward buy on polystyrene be : What is the optimal order quantity and how much should the forward buy on polystyrene be?

Explain what benefits the organization can experience : Explain what benefits the organization can experience. You must use both acronyms.

Calculation of main quantitative methods of forecasting : Simple Moving Average is the most plain and simple calculation of the three main quantitative methods of forecasting.

Financial regulation is form of regulation : Financial regulation is a form of regulation which subjects financial institutions to certain requirements, restrictions and guidelines,

Applying this policy in the considered application context : Can you see any potential problems with applying this policy in the considered application context?

User Account

All Pages