Reference no: EM131438214
1. Westside Auto purchases a component used in the manufacture of automobile generators directly from a supplier. Westside’s generator production operation, which is operated at a constant rate, will require 1000 components per month throughout the year (12,000 total units annually). Assume that the ordering costs are $25 per order, the unit cost is $2.50 per component, and annual holding costs are 20% of the value of inventory. Westside has 250 working days per year and a lead time of 5 days. Please report out the following information:
a) What is the EOQ for this component?
b) What is the reorder point?
c) What is the cycle time?
d) What are the total annual holding and ordering costs associated with your recommended EOQ?
Now, suppose Westside Auto decides to operate with a backorder inventory policy. Backorder costs are estimated to be $5 per unit per year. Identify the following:
e) Minimum cost order quantity
f) Maximum number of backorders
g) Maximum inventory
h) Cycle time
i) Total annual cost
Which approach would you recommend to Westside Auto, using back orders or not? Why?
2. Wilson Publishing Company produces books for the retail market. Demand for a current book is expected to occur at a constant annual rate of 7200 copies. The cost of one copy of the book is $14.50. The holding cost is based on an 18% annual rate, and production setup costs are $150 per setup. The equipment on which the book is produced has an annual production volume of 25,000 copies. Wilson has 250 working days per year, and the lead time for a production run is 15 days. Use the production lot size model to compute the following:
a) Minimum cost production lot size
b) Number of production runs per year
c) Cycle time
d) Length of a production run
e) Maximum inventory
f) Total annual cost
g) Reorder point
Inventory management team prior to her promotion
: Elinore has just been promoted to a product manager position. She has worked for 10 years on the inventory management team prior to her promotion. She knows the inventory is not well managed and has suffered from both excess inventory shortages.
|
Differences between tactical and strategic planning
: What is the similarities and differences between tactical and strategic planning? If you are the CEO of a company engaged in fierce competition, which planning technique would you use and why?
|
What is multifactor productivity
: C&A bakery produces 1500 loaves of bread a month. Labor productivity is 2.344 loaves per labor-hour. Each worker works 160 hours per month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35 per loaf. What is C&A's multifactor produ..
|
Less effective as change manager if you dropped below radar
: How would you describe your role as a change manager using the terms introduced in this chapter: champion, soul-of-fire, quiet leader, positive deviant, disruptive innovator? How is this reflected in your behavior? Would you become more or less effec..
|
Component used in manufacture of automobile generators
: Westside Auto purchases a component used in the manufacture of automobile generators directly from a supplier. Westside’s generator production operation, which is operated at a constant rate, will require 1000 components per month throughout the year..
|
Furniture making is labor intensive-although saws-sanders
: The production facility is a large, rectangular building with a 30-foot ceiling. Furniture making is a labor intensive, although saws, sanders, and other equipment are very much a part of the process. Suppose the company has just received an order fo..
|
Three devices at minimum cost to the manufacturer
: A manufacturer produces three different devices (device A, B and C) at two manufacturing facilities (the San Francisco plant and the New Orleans plant). Each day the San Francisco plant can produce 109 units of device. Find the number of days that ea..
|
Predetermined rate under traditional allocation method
: Label your answers and put them in final form as appropriate. Ramses Manufacturing manufactures several products. Ramses has adopted the traditional overhead allocation method for allocating manufacturing overhead, and direct labor hours have been se..
|
Personal and professional accountability
: Personal and professional accountability, Career planning, Personal journey disciplines, Reflective practice reference behaviors/tenets, Discuss how you will use your current leadership skill sets in nursing to advocate for change in your workplace.
|