Standard size order be for the product

Assignment Help Business Management

Reference no: EM1378413

Assume you have just met with the director of buying. He has been attempting to decrease his expenses by placing fewer orders(but larger)orders for raw materials. You suspect that his dept.'s actions have been contributing to the company's DOS.
I need to calculate EOQ/ELS for the following two questions. I need to show the full calculations. Please HELP! I am so lost!

Annual demand has historically been about 15,000 units. Each unit costs about $0 dollars. For the annual report due in June, the Corp. Accounting Dept calculates inventory holding costs by multiplying the value of each item by 40 cents. The Director of Purchasing told you that his "cost of ordering is about 82 dollars per order. He is currently ordering 1,000 at a time. How large should the standard size order be for this product? How much is the Purchasing directors policies costing your Company? Calculate the ordering and holding costs associated with his policies and compare them with the optimal ordering and holding costs.

2. Annual demand has historically been about 5,700 units. The sales price for each unit of CLM is about 48 dollars. The production line that produces CLM can make 100 units a day, but currently has 170 days per year devoted to manufacturing another project---assume 250 total production days per year. The set up cost for product CLM averages 500 dollars per set up. How large should the production runs be for CLM?

Reference no: EM1378413

Questions Cloud

Comparing teams and work groups : Discuss are the differences in Leadership at Green River and FMC Aberdeen and will work groups and teams work at Green River, explain your answer?

Sources of potential process losses : Assume you will be a part of the newly formed assignment staff team. This team will require to realize process gains within its first three months.

Constructing a decision tree : We are considering an event for next June. Assume if we select an outdoor venue, we make 350,000 dollars, but if it rains we lose 40,000. If we select an indoor venue, we make 150,000 rain or not.

Evaluating an ecommerce website : Create a check list that contains key point for evaluating an ecommerce website - Write a short, reflective report about website

Standard size order be for the product : Assume you have just met with the director of buying. He has been attempting to decrease his expenses through placing fewer orders orders for raw materials.

Define economic profits : The Johnson Oil Corporation has just employed the best manager in the industry. Should the owners of the company anticipate economic profits? Explain your answer and define economic profits

Prepare a complete work sheet : Noah's Ark has a fiscal year ending on September 30. Selected information from the September 30 work sheet are given below.

Implement an se approach to achieve project success : Provide good example with detail data supporting both sides of the given argument and suggestion as to how we would implement an SE approach to achieve assignment success.

Regression of the rate of inflation : Using the data on the growth rate of Money and inflation, run a regression of the rate of inflation on the rate of growth of the money supply

User Account

All Pages