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A store has collected the following information on one of its products: Demand = 10,000 units/year ...

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A store has collected the following information on one of its products: Demand = 10,000 units/year ...

A store has collected the following information on one of its products:

   Demand = 10,000 units/year
   Standard deviation of weekly demand = 25 units
   Ordering costs = $30/order
   Holding costs = $4/unit/year
   Cycle-service level = 95% (z for 90% = 1.28)
   Lead-time = 2 weeks
   Number of weeks per year = 50 weeks

a.   If a firm uses the continuous review system to control the inventory, what would be the order quantity and reorder point?
b.   The firm decided to change to the periodic review system to control the item's inventory. For the most recent review, an inventory clerk checked the inventory of this item and found 200 units. There were no scheduled receipts at the time. How many units should be ordered? (HINT: Use the EOQ model to derive P, the time between reviews.)

Textbook

Operations Management: Processes and Supply Chains

Edition: 11^th

Authors: Krajewski, Ritzman, Malhotra

Read 591 times

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takemeaway Author

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7 years ago

Problem solved, many thanks

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Dreamin

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7 years ago

If you need anymore business related help, let us know

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UpDown

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4 years ago

Thanks alot

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Joseph S.

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4 years ago

Thanks

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Christian D.

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4 years ago

thanks

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Manish B.

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4 years ago

Thank You!

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Tanmoy S.

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thank you

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Priyanka B.

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Thanks you

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