Economic order quantity, Mechanical Engineering

Assignment Help:

Economic Order Quantity:

Assume an economic order quantity case where annual demand D = 500 units, economic order quantity Q = 100 units, the wanted probability of not stocking out P = 0.95, the standard deviation of demand during lead time σ L = 20 units, and Lead time L = 12 days. Discover the reorder point. Suppose that demand is over a 250 = workday year.

Solution

d' in above example is

 d = 500 /250 = 2   and lead time is 12 days.

 From the equation,

R = d'L + z σL  = 2 (12) + z (20)

Since, in this case z is 1.64. Substituting this value of z, we achieved

R = 2 (12) + 1.64 (20) = 24 + 32.8 = 56.8 units

This illustrated that when the stock on hand gets down to 56 units, order 100 more.


Related Discussions:- Economic order quantity

Subcontractor submittals, The Supplier/Subcontractor shall submit, for acce...

The Supplier/Subcontractor shall submit, for acceptance, their Material Traceability and PMI program and procedures, which shall comply with this specification, prior to the sourci

State the categorise of foundations, State the Categorise of foundations ...

State the Categorise of foundations Categorise special foundations into three types based on i)  Demands arising from uncommon loading or environmental conditions, ii)  D

Determine magnitude and direction of the resultant force, Determine magnitu...

Determine magnitude and direction of the resultant force: A system of forces is acting at the corner of a rectangular block as shown in the figure. Determine magnitude and di

Explain extension of screw conveyor by hydraulic cylinder, Explain Extensio...

Explain Extension of screw conveyor by hydraulic cylinder "Extension of screw conveyor with the help of linkage arrangement by hydraulic cylinder and hinged joint" Procedur

Module assembly site preparation, Q. Module Assembly Site Preparation? ...

Q. Module Assembly Site Preparation? To set a module on the piles installed on project site, the following preparations shall be made: The Designer shall provide design elev

Abrasive machining processes, Abrasive Machining Processes Such machin...

Abrasive Machining Processes Such machining processes are precision machining processes. They generate work-piece surfaces along with a high degree of surface smoothness and d

Find out the final extension and the work done, Find out the final extensio...

Find out the final extension and the work done: Problem:  (i) A spring of stiffness 4 N/cm of extension is extended steadily yet the force of 20 N is reached. Find out th

Objectives-object-oriented control architecture , Objectives After stud...

Objectives After studying this section, you should be capable to understand: Cell control and modeling, Context level data flow diagram, A common cell control sy

Intermodular piping connections, Q. Intermodular Piping Connections Ali...

Q. Intermodular Piping Connections Alignment of pies shall be achieved as detailed in the construction drawings. Special attention shall be paid to the alignment and installati

Write Your Message!

Captcha
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