Major appliances-What would the average inventory level be

Assignment Help Operation Management

Reference no: EM131764973

Emarpy Appliance is a company that produces all kinds of major appliances. Bud Banis, the president of Emarpy, is concerned about the production policy for the company's best-selling refrigerator. The annual demand for this has been about 8250 units each year, and this demand has been constant throughout the year. The production capacity is 130 units per day. Each time production starts, it costs the company $120 to move materials into place, reset the assembly line, and clean the equipment. The holding cost of a refrigerator is $54 per year. The current production plan calls for 390 refrigerators to be produced in each production run. Assume there are 250 working days per year.

What is the daily demand of this product? units (enter your response as a whole number).

If the company were to continue to produce 380 units each time production starts, how many days would production continue (enter your response as a whole number).

Under the current policy, how many production runs per year would be required? (round your response to the nearest whole number).

What would the annual setup cost be (round your response to the nearest whole number).

If the current policy continues, how many refrigerators would be in inventory when production stops units (round your response to the nearest whole number).

What would the average inventory level be? units (round your response to the nearest whole number).

If the company produces 380 refrigerators at a time, what would the total annual setup cost and holding cost be $ (round your response to the nearest whole number).

If Bud Banis wants to minimize the total annual inventory cost, how many refrigerators should be produced in each production run (round your response to the nearest whole number).

How much would this save the company in inventory costs compared to the current policy of producing 380 units in each production run $ (round your response to the nearest whole number).

Reference no: EM131764973

Questions Cloud

Why are quality measures important : Why are quality measures important and what is the difference between quality measures and performance indicators? What performance measures are used for NP

Americans with disabilities act : What do you need to diagnose in your current selection program to be sure you are in compliance with the Americans with Disabilities Act?

Discuss why groupthink takes place : To reduce the possibility of groupthink before the start of the meeting, Fred encourages everyone to speak up with their opinions-no matter what those opinions.

Will the number of units required to break-even increase : Will the number of units required to break-even increase or decrease? Explain. Hint: Detailed calculations are not needed to obtain the proper solution.

Major appliances-What would the average inventory level be : Emarpy Appliance is a company that produces all kinds of major appliances. What is the daily demand of this product? What would the average inventory level be

Deficiency before the statute of limitations expires : On March 15, 2015, a corporation filed its 2014 calendar year tax return showing $120,000 gross income. The return was prepared by a CPA who mistakenly omitted

Determine the weighted-average unit contribution margin : Annual fixed costs are $3,630,000, and data about the three products follow. A B C Sales mix in units 50% 30% 20% Selling price $200 $600 $800 Variable cost.

What the political issue is and what events have taken place : What the political issue is and what events have taken place pertaining to the issue? How major political forces relate to the issue?

What major challenges might stepfamilies face : What major challenges might stepfamilies face? Do they have it harder than people married for first time with biological children only? Explain

User Account

All Pages