Minimize total costs considering extra handling costs

Assignment Help Operation Management
Reference no: EM132201321

You work at DeliWine, a wine retailer. DeliWine sources one of their best selling wines, BeauRoux, from a France wine distributor. The cost of placing an order is $ 513 and the annual holding cost rate of DeliWine is 14 %. The lead time is 2 weeks and DeliWine only pays for the goods when the shipment arrives at their distribution center. Assume that there are 48 weeks in a year.

The annual demand for BeauRoux is very stable at 34954 bottles. The costs of BeauRoux is $ 78 per bottle.

Question:

BeauRoux is packed in a special bottle that requires very careful handling. For large deliveries, some extra employees are needed to help unpack. You pointed to your manager that there is an extra handling cost of $0.34 for each bottle of BeauRoux if the order for BeauRoux is larger than 409 bottles. (You can consider that each bottle costs $0.34 more if the order for BeauRoux is larger than 409.)

What is the order size that will minimize total costs considering the extra handling costs?

 

Reference no: EM132201321

Questions Cloud

Normative theories of ethics : 'Normative theories of ethics' from the book 'moral issues in business' by cengage learning australia.
Define the piece of legislation : Define the piece of legislation that specifically identifies the rights of American workers?
Laws that drive policies-procedures and practices : There are many laws that effect how Human Resources deal with employees.
Swot analysis for regulatory government organisation : SWOT analysis for a regulatory government organisation in the Oil and Gas. List and define arbitration and mediation? How are these grievence
Minimize total costs considering extra handling costs : What is the order size that will minimize total costs considering the extra handling costs?
Explain in detail how performance measurement plans : Explain in detail how Performance measurement plans and talent acquisition plan can be beneficial for a small organization
Identify ethnographic features and epidemiological features : Identify the ethnographic features and epidemiological features of the population that may cause each issue to differentially affect this population.
Most common form of business ownership is the corporation : The most common form of business ownership is the corporation. Which of the following is a valid contract under UCC?
The estimated times-immediate predecessors for activities : The estimated times and immediate predecessors for the activities in a project at John Black’s company are given in the following table.

Reviews

Write a Review

Operation Management Questions & Answers

  Describe the type of government

Describe the type of government and recent political developments that could influence the economic and business environment of the country.

  Dissatisfaction or unhappiness of the employees

List as many aspects of a job as you can think of that would increase the likelihood of dissatisfaction or unhappiness of the employees.docx

  Symbiotic resource interdependencies

The potential interorganizational linkage mechanisms that the Disney Organization uses to manage its symbiotic resource interdependencies

  Describe the offensive strategies for blockbuster

Will new competition for Redbox and digital content providers force blockbuster to alter its strategy? If yes, what are the offensive strategies for blockbuster?

  Why you believe the decision was made to communicate

In a 250-300 word response, relate an organizational example of the use or lack of use of ethical standards in management communications.

  Reduce costs of internally performed value chain activities

Strategic actions to reduce the costs of internally performed value chain activities and improve a company’s cost competitiveness. work best when aimed at increasing the amount of the company’s low-cost competitive assets and decreasing the amount of..

  What is the regulated price of electricity

If the regulatory agency allows a 10 percent rate of return on the rate base, what is the regulated price of electricity, and the utility's annual earnings?

  Potential risk associated with performing the project

Create a risk assessment that lists the potential risk associated with performing the project, along with ways to address the risks.?

  Despite store requesting to pick the table up from women

Rebecca purchases a table from a local furniture store for $5000. She decided she does not want the table because of a defect. She successfully cancels the payment on the credit card for payment of the table, and continues to keep the table despite t..

  Describe the effects on the wedding plans of each incident

A call to Guatemala revealed that the potential bridesmaid had several commitments and could not possibly leave the country until April 10.

  What qualifications might be necessary for staff members

Describe the advantages to using paid and volunteer staff for life safety and fire prevention programs and the problems that might occur between newly hired staff in Christmas Valley and the neighboring jurisdiction, where code compliance inspecti..

  How to weave the mission-vision throughout the organization

How do you communicate the mission, vision, and values of your nonprofit organization? Explain how to weave the mission, vision, and values throughout the organization.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd