The critical fractile method for a newsvendor model

Assignment Help Accounting Basics

Reference no: EM131106546

A department store is trying to decide how many JP Desksquirt II printers to order. Because JP is about to come out with a new model in a few months, the store will order only a limited number of model IIs. The cost per printer is $200, and each printer is sold for $230. If any model IIs are still in stock when the next model comes out, they will be sold for $150 apiece. If a customer wants a model II, and there are none left, the store will special order the printer at an extra cost (to the store) of $25. These printers are not in great demand. The store estimates that the number of model IIs that will be demanded during the next few months (before the next model comes out) is equally likely to be any value from 10 to 20, inclusive. According to the critical fractile method for a newsvendor model, how many printers should the store order?

Reference no: EM131106546

Questions Cloud

Determining the shares of stock : The underwriters charge a 7.8 percent spread, the administrative costs are $411,000, and the offer price is $35 per share. How many shares of stock must be sold if the firm is to raise the funds it desires?

Prepare all journal entries necessary on those three dates : Wool ford Inc. declared a cash dividend of $1.00 per share on its 2 million outstanding shares.

What is the length of the string : Calculate the average speed of the cart as it coasts from 0 cm to 20 cm. Answer in meters per second. Calculate the kinetic energy of the system as the cart coasts from 0 cm to 20 cm.

Determining the capital gains yield : What would your capital gains yield have been if you had purchased this stock one year ago and then sold the stock today?

The critical fractile method for a newsvendor model : A department store is trying to decide how many JP Desksquirt II printers to order. Because JP is about to come out with a new model in a few months, the store will order only a limited number of model IIs.

Required rate of return for the project : The company is considering a project that it considers riskier than its current operations so it wants to apply an adjustment of 1 percent to the project's discount rate. What should the firm set as the required rate of return for the project?

A firm experiences demand with a mean : A firm experiences demand with a mean of 100 units per day. Lead time demand is normally distributed with mean 1000 units and standard deviation 200 units. It costs $6 to hold one unit for one year.

Show that it is the transpose of one of identities : The identities of Eqs.(14.47) through (14.49) follow from equating corresponding terms in the two sides of Eq. (14.46).There is actually a fourth identity to be considered. Find this identity and show that it is the transpose of one of the identit..

Prepare hingess journal entry : Hinges Corporation issued 500 shares of $100 par value preferred stock for $61,500. Prepare Hinges’s journal entry.

User Account

All Pages