Used to approximate the cost trade-offs of the EOQ

Assignment Help Operation Management

Reference no: EM131786542

Sam's Cat Hotel operates 49 weeks per year, 7 days per week. It purchases kitty litter for $ 7.00 per bag. The following information is available about these bags:

Demand = 65 bags/week

Order cost = $60/order

Annual holding cost = 30 percent of cost

Desired cycle-service level=96 percent

Lead time = 2 week(s) (14 working days)

Standard deviation of weekly demand = 4 bags

Current on-hand inventory is 250 bags, with no open orders or backorders.

Suppose that Sam's Cat Hotel uses a P system. The average daily demand {\d }\bar{d} is 9 bags (65/7) and the standard deviation of daily demand ?” standard deviation of weekly demand / \sqrt{}days per week" is 1.512 bags. Please answer all parts.

a. What P (in working days) and T should be used to approximate the cost trade-offs of the EOQ?

The time between orders, P, should be____days (Enter your response rounded to the nearest whole number.)

The target inventory, T, should be___ days (Enter your response rounded to the nearest whole number.)

b. How much more safety stock is needed than with a Q system ____ bags. (Enter your response rounded to the nearest whole number.)

c. It is time for the periodic review. How much kitty litter should be ordered ___bags. (Enter your response as an integer.)

Reference no: EM131786542

Questions Cloud

Assembly operation with quality problems : Consider the following four-step assembly operation with quality problems. What is the capacity of the process?

Challenges manager faces in motivating employees : Identify three challenges a manager faces in motivating employees today as opposed to 50 years ago.

What it meant by business being liable and responsible : we discussed "liable" and "responsible" when it some to tech decisions especial those involving social media, advertising and security.

Adopted by organizations creating lean production system : Which of the following mechanical principles must be adopted by organizations creating a lean production system?

Used to approximate the cost trade-offs of the EOQ : What P (in working days) and T should be used to approximate the cost trade-offs of the EOQ? How much more safety stock is needed than with a Q system?

Rationalization of white collar crime by the perpetuator : Rationalization of a white collar crime by the perpetuator includes which of these:

Inventory is common in traditional production systems : What type of inventory is common in traditional production systems, but most troublesome to lean systems?

In establishing lean production : Toyota Motor Company developed a formula to determine the optimal number of kanbans that should be circulating in a single-card kanban loop.

Model performance process : Task Model the process for the creation and subsequent evaluation of an employee’s target agreement.

User Account

All Pages