Preparing an inventory management plan for screwdrivers

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Reference no: EM131029086

Storied Lane Components is preparing an inventory management plan for screwdrivers. They have a forecasted demand of 10,935 screwdriers per month with a MAD of 152 screwdrivers per month. The lead time to receive screwdrivers is 1 week(s) and they would like to have a 95% service level to avoid turning away customers. Their ordering cost is $422 and their holding cost is $4 per screwdriver (breakage)per year. When doing all calculations assume that there are 4 weeks in 1 month and there are no other contractual requirements on order quantities or frequencies. If following a fixed time inventory system with a review period of 6 weeks, what should their order up to quantity be? Be sure to enter your results with two decimal places.

Reference no: EM131029086

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