Why should spc have cycle inventory

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Reference no: EM132290740

Why should SPC have a cycle inventory? SPC buys polystyrene resin from a supplier in 1000-pound units, and each unit costs $20.00, and the percent holding cost is 10%. The fixed shipping cost per order is $300. If we assume that 1000 pounds of resin yields 1000 pounds of clear plastic, what are the following values for clear plastic:

What are the following values for clear plastic:

Lot size per shipment to minimalize total cost

Economic order quantity

Number of shipments/year for polystyrene resin in order to meet the forecasted demand for clear plastic in 2007

Cycle inventory

Cycle inventory holding cost

Replenishment cycle time

Average flow time

Reference no: EM132290740

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