What is the total annual setup cost and total variable cost

Assignment Help Operation Management
Reference no: EM132127965

The Heavy Duty Company produces a variety of industrial machinery. One of its vendors is Fine Bearings, which supplies Heavy Duty with all of its ball bearings — approximately 52,000 per year. Since Fine Bearings is a small company, it fills large orders gradually rather than in a single delivery. Each time Keith Graham, Heavy Duty's inventory manager, places an order for ball bearings, Fine Bearings begins delivering them a week later at the rate of 2,000 per week. Keith estimates that, in addition to the purchase cost, the cost of placing each order (including shipping costs, the cost of processing and paying for the order, and the cost of inspecting the deliveries and putting them into storage) is $1,000. He also estimates that the cost of holding each ball bearing in inventory is $13 per year.

1. Using EOQ with gradual replenishment, what is the optimal quantity size?

2. What is the total annual setup cost?

3. What is the total annual holding cost?

4. What is the total variable cost (TVC)?

Reference no: EM132127965

Questions Cloud

What are different types of diversity : What is Workplace Diversity? What are different types of Diversity?
Create success via sustainable strategies and design : In what mature industry did the entrepreneurial firm Method manage to change the rules and create success via sustainable strategies and design?
Walmart-achieve operational and strategic excellence : With the advent of science and technology, technological innovations have become a pre-requisite to achieve operational and strategic excellence.
How you might mitigate that risk using either simulation : describe how you might mitigate that risk using either simulation (Crystal Ball) or calculation.
What is the total annual setup cost and total variable cost : What is the total annual setup cost? What is the total annual holding cost? What is the total variable cost (TVC)?
What is the minimum annual total cost : How many units should Jenny order each time she placed an order? What is the minimum annual total cost?
Neglecting their social responsibility in some manner : Find an example of a firm you believe is neglecting their social responsibility in some manner.
Relation sips affect sex segregation and the wage gap : What is the role of socialization in women's and men "choice" of occupations and how to do these relation sips affect sex segregation and the wage gap?
Federal false claims act and federal anti-kickback statute : What is the difference between the federal False Claims Act and the federal Anti-Kickback Statute?

Reviews

Write a Review

Operation Management Questions & Answers

  How do self-driving trucks impact the supply chain

How do self-driving trucks impact the (transportation and distribution) supply chain?

  Use to minimize the fears of invasion of privacy

What controls or limitations would you impose on RFID tags and use to minimize the fears of invasion of privacy?

  Discuss the differences between fraud and abuse

Discuss the differences between fraud and abuse. During your discussion, provide examples of each and how health care managers might deal with them.

  About the six-inch long cockroaches in her apartment

Katrina is complaining to her landlord about the six-inch long cockroaches in her apartment. The landlord scoffs, saying: “Cockroaches don’t get that big! I’ll pay $10,000 to anyone who can show me a six-inch cockroach.” Will, a bug collector, overhe..

  Assignment on describe information management

Assignment On Describe Information Management and Quantitative Research Techniques

  What is the arrival rate

There are currently three cashiers with dedicated lines (single channel system). The customer arrival rate for a line is 10/hr and the service rate is 12/hr. A newly hired manager decides to merge all the times to create a multichannel system.

  Best kind of research-qualitative or quantitative

What is the "best" kind of research: qualitative or quantitative?

  How many patients are treated in the trauma

What percentage of the patients requiring trauma bays end up being sent to another hospital? How many patients are treated in the trauma bays on an average 24 hour day?

  What is the required return

What is the required return? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

  Diversification in determining right mix for your investment

What is the importance of diversification in determining the right mix for your investments? Do you actually believe in the value of diversification as a strategy in your portfolio management? Why?

  What has quality meant in the organization where you have

What has quality meant in the organization where you have worked? How is it measured? Be sure to thoroughly explain your answer.

  How important are ethical concerns in marketing strategy

How important are ethical concerns in their marketing strategy?

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