Xootr procures wheels from a Chinese supplier. The supplier charges $200 perorder (no matter the order quantity) to cover customs fees and other expenses at $3 perwheel. Xootr requires 80,000 wheels per year and its annual holding cost percentage is40 percent. Suppose Xootr orders 8000 wheels with each order. What is the sum of itsordering and inventory holding costs per year?

Xootr procures wheels from a Chinese supplier. The supplier charges $200 perorder (no matter the order quantity) to cover customs fees and other expenses at $3 perwheel. Xootr requires 80,000 wheels per year and its annual holding cost percentage is40 percent. Suppose Xootr orders 8000 wheels with each order. What is the sum of itsordering and inventory holding costs per year?

Name: Xootr procures wheels from a Chinese supplier. The supplier charges $2
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Description: Xootr procures wheels from a Chinese supplier. The supplier charges $200 perorder (no matter the order quantity) to cover customs fees and other expenses at $3 perwheel. Xootr requires 80,000 wheels per year and its annual holding cost percentage is4

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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The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.
1. A local retailer anticipates an annual demand 15000 units of a product. The retailers] allows shortages for that product, and these shortages are backordered at a rate of 4 OMR per unit backordered. The cost of ordering is 200 OMR, whereas, the annual holding cost is 1OMR per unit. The retailer operates 300 days per year. What is the minimum total inventory cost in OMR? Round-up to the nearest integer?? a. 1960 O b. 2191 C. 1789 d. 1898 e. 1550 O f. None is correct
Emil Traders, Inc. sells cellphone cases which it buys from a local manufacturer. Emil Traders sells 24,000 cases evenly throughout the year. The cost of carrying one unit in inventory for one year is P11.52 and the order cost per order is P38.40. What is the economic order quantity? 400 c. 200 b. 283 d. 625 If Emil Traders would buy in economic order quantities, the total order costs is P921,600. c. P 76,800. P 2,304. d. 460,800.
Authentic Thai rattan chairs are delivered to Gary Schwartz's chain of retail stores, called The Kathmandu Shop, once a year. The reorder point, without safety stock, is 200 chairs. Carrying cost is $20 per unit per year, and the cost of a stockout is $70 per chair per year. Given the following demand probabilities during the lead time, how much safety stock should be carried? Demand During Lead Time Probability 0.2 100 0.2 200 0.2 300 0.2 400 0.2 The optimal quantity of safety stock which minimizes expected total cost is units (enter your response as a whole number).
Authentic Thai rattan chairs are delivered to Gary Schwartz's chain of retail stores, called The Kathmandu Shop, once a year. The reorder point, without safety stock, is 200 chairs. Carrying cost is $40 per unit per year, and the cost of a stockout is $70 per chair per year. Given the following demand probabilities during the lead time, how much safety stock should be carried? Demand During Lead Time Probability 0 0.2 100 0.2 200 0.2 300 0.2 400 0.2 The optimal quantity of safety stock which minimizes expected total cost is _ units (enter response as a whole number).
Mac-in-the-Box, Inc., sells computer equipment by mail andtelephone order. Mac sells 1,200 flat-bed scanners per year.Ordering cost is $300, and annual holding cost is 16 percentof the item’s price. The scanner manufacturer offers thefollowing price structure to Mac-in-the-Box: What order quantity minimizes total annual costs?
Boreki Enterprise has the following 10 items in inventory. Theodore Boreki asks you, a recent OM graduate, to divide these items into ABC classifications. Fill in the blanks and then answer the following questions. (Round dollar volume to the nearest whole number and percentage of dollar volume to two decimal places.) % of Total Dollar Dollar Volume Item Annual Demand Cost/Unit Volume A2 250 20 48,000 67,500 5.56 7.81 B8 4000 12 C7 1500 45 D1 150 2000 E9 1000 20 20,000 2.31 F3 60 150 300,000 12,000 G2 200 1500 34.72 H2 600 20 1.39 15 300 300 J8 2500 12,500 1.45
(a) Ignoring taxation, calculate the optimum order level of inventory over a one-year planning period using the EOQ model. (b) Estimate the level of safety inventory that should be carried by Toyzrfun Ltd. (c) If Toyzrfun Ltd were to be offered a quantity discount by its suppliers of 1% for orders of 30 000 units or more, evaluate whether it would be beneficial for the company to take advantage of the quantity discount. Assume for this calculation that no safety inventory is carried. (d) Estimate the expected total annual costs of inventory management if the EOQ had been (i) 50% higher, and (ii) 50% lower than its actual level. Comment upon the sensitivity of total annual costs to changes in the EOQ.
10 Use the information presented in the graph to answer the following questions: Annual Cost C3 C2 Q1 You are also given the following information: Q1 =450 .Q2 = 700 C1 = 350 C2 = 750 1300 Q2 Order Quantity Which annual inventory cost component does the blue line represent? Total cost Which annual inventory cost component does the green line represent? Holding cost What is the Economic Order Quantity (EQ9) based on th Which annual inventory cost component does the red line represent? Ordering cost 220
Interpretation of the inventory holding period depends on the industry in which a business operates. An increase in inventory days might be explained by which of the following? a) Seasonal variations in demand leading to a dramatic increase in the volume of sales of finished goodsb) Supply problems arising from difficulties in purchasing raw materials from suppliersc) A new policy to reduce the level of inventory to reduce the associated costs of storage and insuranced) A business deliberately building up inventories prior to a large order THERE CAN ONLY ONE OPTION
Per Norstrom supplies computer systems to a warehouse in Rotterdam. He sells 16 systems a week. The cost of an average system is €5000, while order administration costs and delivery from Malaysia cost €1000. The lead time is around 4 weeks and holding costs are around 16 percent a year. What policy would you recommend for Per?
K Race One Motors is an Indonesian car manufacturer. At its largest manufacturing facility, in Jakarta, the company produces subcomponents at a rate of 290 per day, and it uses these subcomponents at a rate of 12,700 per year (of 250 working days). Holding costs are $2 per item per year, and ordering costs are $31 per order. a) What is the economic production quantity? 690.88 units (round your response to two decimal places). b) How many production runs per year will be made? 18.38 production runs (round your response to two decimal places). c) What will be the maximum inventory level? units (round your response to two decimal places).