Illustrate what is the time between orders

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Reference no: EM1377799

Q. Joe Henry's machine shop uses 2,500 brackets during the course of a year. These brackets are purchased from a supplier 90 miles away.

The subsequent information is known about the brackets.

Annual demand 2,500
holding cost per bracket per year $1.50
order cost per order $18.75
Lead time 2 days
working days per year 250

a. Given the above information, illustrate what would be the economic order quanity (EOQ)?

b. Given the EOQ, illustrate what would be the average inventory? Illustrate what would be the annual inventory hold cost?

c. Given the EOQ, explain how many orders would be made each year? Illustrate what would be the annual order cost?

d. Given the EOQ, illustrate what is the total annual inventory cost?

e. Illustrate what is the time between orders?

f. Illustrate what is the reorder point (ROP)?

Reference no: EM1377799

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