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a) What is the EOQ for these colourful silk headscarves? b) What is the Average Inventory in RM value? c) Using a 52-week year, at what inventory unit level should an order be placed?

a) What is the EOQ for these colourful silk headscarves? b) What is the Average Inventory in RM value? c) Using a 52-week year, at what inventory unit level should an order be placed?

Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
6th Edition
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Chapter16: Lean Supply Chain Management
Section: Chapter Questions
Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...
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Naelofar.com, Malaysia's largest Hijab, Modest Fashion Online, uses many colorful silk headscarves in its hand-printed silk headscarves production process. The company uses 2,250,000 square yards of these colourful silk headscarves throughout the year. The fixed costs of placing and receiving an order are RM2500. The price of the headscarf is RM8 per square yard, and the annual cost of carrying this inventory item is 25% of the price. The company maintains a 20,000 square yards safety stock. The headscarves supplier requires two weeks for delivery. a) What is the EOQ for these colourful silk headscarves? b) What is the Average Inventory in RM value? c) Using a 52-week year, at what inventory unit level should an order be placed?
Transcribed Image Text:Naelofar.com, Malaysia's largest Hijab, Modest Fashion Online, uses many colorful silk headscarves in its hand-printed silk headscarves production process. The company uses 2,250,000 square yards of these colourful silk headscarves throughout the year. The fixed costs of placing and receiving an order are RM2500. The price of the headscarf is RM8 per square yard, and the annual cost of carrying this inventory item is 25% of the price. The company maintains a 20,000 square yards safety stock. The headscarves supplier requires two weeks for delivery. a) What is the EOQ for these colourful silk headscarves? b) What is the Average Inventory in RM value? c) Using a 52-week year, at what inventory unit level should an order be placed?
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