Inventory policy over the policy currently being used

Reference no: EM1395184

Keith Shoe Stores carries a basic black dress shoe for men that sells at an approximate constant rate of 500 pairs of shoes every 3 months. Keith's current buying policy is to order 500 pairs each time an order is placed. It costs Keith $30 to place an order. The annual holding cost rate is 20%. With an order quantity of 500, Keith obtains the shoes at the lowest possible unit cost of $28 per pair. Other quantity discounts offered by the manufacturer are as follows. What is the minimum-cost order quantity for the shoes? What are the annual savings of your inventory policy over the policy currently being used by Keith?

Order Quantity Price Per Pair

0-99                          $36
100-199    $32
200-299                    $30
300 or more              $28

Reference no: EM1395184

Questions Cloud

How research method in psychology advantageous : Research Design: Prepare the own research design. Follow outline below and explain each step. Write down concluding paragraph explaining how the research method in psychology advantageous for you today.

Standard deviation of the mean : The lifetimes of light bulbs of a particular type are normally distributed with a mean of 370 hours and a standard deviation of 5 hours. What percentage of bulbs has lifetimes that lie within 1 standard deviation of the mean on either side?

Understanding business and technical writing prompt : Understanding my Business and Technical Writing prompt, writing and informal investigaive report on "standard business practices or important trends in your field of interest and draw conlcusions as to what these trends mean for, or represent in, y..

Computing e-value of distribution : A person runs one mile to his house as fast as he can. It is equally likely that he will run at an average speed of 3 miles per hour, 6 miles per hour, and 9 miles per hour.

Inventory policy over the policy currently being used : What is the minimum-cost order quantity for the shoes? What are the annual savings of your inventory policy over the policy currently being used by Keith?

Description of control limits : A cola dispensing machine is set to depense 9 ounces per cup with a standard deviation of .5 oz .THe manufacturer would like to set the control limits so that for samples of 16,

Prepare outline for research paper on hate crimes : Prepare the outline for the research paper on hate crimes with this thesis statement : To prevent the disaster from hate crimes laws must be formulated to strictly deal

Sampling distribution model of proportion-mean : A company supplies poultry farmers with hens, advertising that a mature B300 Layer produces eggs with a mean weight of 60.7 grams. Suppose that egg weights follow a Normal model with standard deviation 3.1 grams.

Higher or lower level of plasma glucose : A study of 100 sedentary people in this age group is planned to test whether they have a higher or lower level of plasma glucose then the general population.

User Account

All Pages