What is the reorder point without safety stock

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Reference no: EM132224243

High Tech, Inc. is a virtual store that stocks a variety of calculators in their warehouse. Customer orders are placed, the order is picked and packaged, and then shipped to the customer. A fixed order quantity inventory control system helps monitor and control these SKUs. The following information is for one of the calculators that they stock, sell, and ship.

Average demand 12.5 calculators per week

Lead time 3 weeks

Order cost $20/order

Unit Cost $8.00

Carrying Change rate .25

Number of weeks 52 weeks per year

Standard Deviation of weekly demand 3.75 calculators

SKU service level 95 percent

Schedule receipts 20 calculators

Current on-hand inventory 35 calcutors

Backorders 2

What is the Economic Order Quantity?

What is the total annual order and inventory-holding costs for the EOQ?

What is the reorder point without safety stock?

What is the reorder point with safety stock?

Based on the previous information, should a fixed order quantity be placed, and if so, for how many calculators?

Reference no: EM132224243

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