What is the optimal number of orders per year

Assignment Help Operation Management
Reference no: EM132133506

Inventory Management

(a) George is attempting to perform an inventory analysis on his most popular products. Annual demand for this product is 5000 units; unit cost is K200,000; carrying cost is considered to be approximately 25% of the unit price. Order costs for his company typically run nearly K30,000 per order and lead times average 10 days.

(i) What is the economic order quantity?

(ii) What is the reorder point?

(iii) What is the total annual stocking cost?

(iv) What is the optimal number of orders per year?

(v) What is the optimal number of days between orders (assume 200 working days per year)?

(b) Daily demand for bread is normally distributed with a mean of 50 units and a standard deviation of 6. Supply is virtually assured with a lead time of 5 days. The cost of placing an order is K25,000 and annual carrying costs are 20% of the unit price of K2,000. A 90% service level is desired for the customers who place orders during the re-order period. Backorders are allowed. Once stocks are depleted, orders are filled as soon as the stocks arrive. There are no stocks out costs. We can assume sales are made over the entire year. What is the reorder point?

Reference no: EM132133506

Questions Cloud

Adopt weighted scoring method to select the provider : Which other criteria could you take into account? Adopt a weighted scoring method to select the provider.
Influenced the way the business is structured and operates : Explain the extent to which the strategy you decided on above has influenced the way the business is structured and operates.
Annual distribution cost of the current distribution network : What is the annual distribution cost of the current distribution network that uses small trucks in Illinois and LTL in Arizona?
Talk about current stratgic of ebay company : Talk about current Stratgic of eBay company? what steps would you take to maximize the effectiveness of your recruitment effort using social media ?
What is the optimal number of orders per year : What is the economic order quantity? What is the optimal number of orders per year? What is the total annual stocking cost?
Were the reasons for arshad disillusionment : What, according to you, were the reasons for Arshad’s disillusionment? Answer the question using Maslow’s Hierarchy of Needs
Discuss specific examples for which this style of management : Discuss specific examples for which this style of management proved to be effective, as well as examples for which it proved to be ineffective.
What are the benefits of third-party intervention : What are the benefits of a third-party intervention by a manager among the employees he or she manages? What are the drawbacks?
Think of difficult negotiation you must soon address : Think of a difficult negotiation you must soon address. What barriers do you perceive in achieving an integrative resolution?

Reviews

Write a Review

Operation Management Questions & Answers

  Book review - the goal

Operations Management is about a book review. Title of the book is "Goal". This book has been written by Dr. Eliyahu Goldartt. The book has been appreciated by many as one of those books which offers an insight into the operations and strategic capac..

  Operational plan in hospitality enterprise

Operational plan pertaining to a hospitality enterprise is given in detail in the solution. The operational plan is an important plan or preparation which gives guidelines regarding the role and responsibilities of each and every operation at all lev..

  Managing operations and information

Recognise the importance of a strategic approach to the development and deployment of organisational information systems. Demonstrate an understanding of the importance of databases and their integration to the organisation's overall information mana..

  A make-or-buy analysis

An analysis of the holding costs, including the appropriate annual holding cost rate.

  Evolution and contributor of operations management

Briefly explain Evolution and contributor of Operations management.

  Functions and responsibilities of an operations manager

A number of drivers of change have transformed the roles, functions and responsibilities of an operations manager over recent years. These drivers have not only been based on technological innovations but also on the need for organisations to develop..

  Compute the optimal order quantity

Compute the Optimal Order quantity of DVD players. Determine the appropriate reorder point.

  Relationship to operations practice in the organisation

Evaluate problems in operations and identify approaches to overcoming them. Critically evaluate operating plans and identify areas for improvement. Justify, implement and evaluate changes to operations in line with modern approaches.

  A make or buy analysis

Develop a report for Figi Fabricating that will address the question of whether the company should continue to purchase the part from the supplier or begin to produce the part itself.

  Prepare a staffing plan

Prepare a staffing plan showing the change of your unit from medical/surgical staffing to oncology staffing.

  Leadership styles in different organizations

Ccompare the effectiveness of different leadership styles in different organizations

  Risk management tools and models

Be able to understand the concept of risk, roles and responsibilities for risk management and risk management tools and models.

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