What is the economic quantity for ben to order

Assignment Help Operation Management
Reference no: EM132794561

Gentle Ben's Bar and Restaurant uses 5,000 quart bottles of an imported wine each year. The effervescent wine costs $3 per bottle and is served only in whole bottles because it loses its bubbles quickly. Ben figures that it costs $10 each time an order is placed, and hold costs are 20 percent of the purchase price. It takes weeks for order to arrive. Weekly demand is 100 bottles (closed two weeks per year) with a standard deviation of 30 bottles. Ben would like use an inventory system that minimizes inventory cost and will provide a 95 percent service probability.

a. What is the economic quantity for Ben to order?

b. At what inventory level should he place an order?

Reference no: EM132794561

Questions Cloud

Compute the sample size of times needing : A manager at SmallBell, a small telephone company, wants to determine how long service technicians need to perform a certain repair.
What was the third payment : The loan was repaid by payments of $3200 on April 15, 2012, $4000 on June 18, 2012 and a final payment on September 12, 2012. What was the third payment
State the role of flexible leadership-individual perspective : Can you state the role of flexible leadership and individual perspectives in relation to leaders managing change of the pandemic
Do a correct statement of comprehensive income : Do a correct statement of comprehensive income, beginning with income before income taxes. (Enter loss using either a negative sign preceding)
What is the economic quantity for ben to order : Gentle Ben's Bar and Restaurant uses 5,000 quart bottles of an imported wine each year. The effervescent wine costs $3 per bottle and is served only in whole bo
Record the journal entry at maturity for the collection : Cityone Bank loaned $15,000 to Jones company in exchange for a 8%, 90 day promissory note. Record the journal entry at Maturity for the collection
Identify an online sales company : Identify an online sales company and explain how the concepts of complexity and divergence apply. Provide specific examples in response.
Determine the direct materials price variance : Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance
Prepare a bond discount amortization schedule : Prepare a bond discount amortization schedule which shows the amortization of discount for the first two interest payment dates.

Reviews

Write a Review

Operation Management Questions & Answers

  Discuss the morality of legal punishment

Discuss the morality of legal punishment in the U.S., drawing support from one (or more) of the ethical approaches presented.

  Approach to regulation of offshore drilling

Discuss Royal Dutch Shell's approach to regulation of offshore drilling.

  Nature of dilemma for Helen using the AICPA Code as guide

Family Games, Inc., is a publicly owned company with annual sales of $50 million from a variety of wholesome electronic games that are designed for use by the entire family. However, during the past two years, the company reported a net loss due to c..

  What is importance of reliability in production environment

What are the activities that they do under their TPM programs? What similarities do you notice between the approaches of the two companies? What differences do you identify? What is the importance of reliability in a production environment?

  A service process design flowchart is referred to as a

1. a service process design flowchart is referred to as a service blueprint to emphasize what?2. even though they

  Analyze the industry in which academy sports competes

Analyze the industry in which Academy Sports competes.

  Profit industry that there are inherent problems in system

Do you think that because healthcare is considered a commodity and is in general a for profit industry that there are inherent problems in the system?

  Ethical dilemma-when does a little white lie turn gray

Ethical Dilemma: When does a little white lie turn gray? It’s been a rough year for your company, a manufacturer of special-purpose construction equipment. A competitor has come out with a line of machinery that costs half as much as yours and perfor..

  Price fixing by business is not generally viewed acceptable

"Price fixing by business is not generally viewed as an acceptable or desirable practice (in domestic markets).

  What is the number of orders per year-annual holding cost

What is the EOQ? What is the number of orders per year? What is the annual holding cost?

  Explain ibm communication systems and strategies

Explain IBM communication systems and strategies

  Essential element of the organizing facet of the p-o-l-c

If social networks are an essential element of the organizing facet of the P-O-L-C framework, should employers track the use of LinkedIn or Facebook among their employees? Why or why not?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd