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Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER Item cost $10.00 VALUE Order cost Annual holding cost Annual demand Average weekly demand Standard deviation of weekly demand Lead time Service probability $250.00 per order 33% of item cost 25,750 units 515 per week 25 units 1 week 95%

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER Item cost $10.00 VALUE Order cost Annual holding cost Annual demand Average weekly demand Standard deviation of weekly demand Lead time Service probability $250.00 per order 33% of item cost 25,750 units 515 per week 25 units 1 week 95%

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Determine the order quantity, reorder point, annual holding cost, and order cost, then assume a price break of $50 per order was offered for purchase quantities of 2,000 or more units per order. If you took advantage of this price break, how much would you save annually? When calculating the z-score, use the NORM.S.INV() function from excel. 

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER Item cost $10.00 VALUE Order cost Annual holding cost Annual demand Average weekly demand Standard deviation of weekly demand Lead time Service probability $250.00 per order 33% of item cost 25,750 units 515 per week 25 units 1 week 95%
Transcribed Image Text:Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER Item cost $10.00 VALUE Order cost Annual holding cost Annual demand Average weekly demand Standard deviation of weekly demand Lead time Service probability $250.00 per order 33% of item cost 25,750 units 515 per week 25 units 1 week 95%
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