Whar are total annual ordering costs for kona coffee? beans

Reference no: EM131441206

A gourmet coffee shop in downtown San Francisco is open 200 days a year and sells an average of 75 pounds of Kona coffee beans a day.? (Demand can be assumed to be distributed normally with a standard deviation of 13 pounds per? day). After ordering? (fixed cost? = ?$14 per? order), beans are always delivered from Hawaii in exactly 4 days.? Per-pound annual holding costs for the beans are ?$4. Refer to the standard normal table for? z-values.

?a) What is the economic order quantity? (EOQ) for Kona coffee? beans? 325 pounds ?(round your response to the nearest whole? number). ?

b) What are the total annual holding costs of stock for Kona coffee? beans? ?$_____ ?(round your response to two decimal? places). ?

c) What are the total annual ordering costs for Kona coffee? beans? ?

d) Assume that management has specified that no more than a 11?% risk of stockout during lead time is acceptable. What should the reorder point? (ROP) be?

e) What is the safety stock needed to attain a 11?% risk of stockout during lead? time?

f) What is the annual holding cost of maintaining the level of safety stock needed to support a 11?% ?risk?

Reference no: EM131441206

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