Total transportation and in-transit and safety holding cost

Assignment Help Operation Management
Reference no: EM13841726

An appliance manufacture has a plant near Toronto that receives small electric motors from a manufacturer located in Winnipeg. The demand for the motors is 120,000 units per year. The cost of each motor is $120. The motors are purchased in lots of 3,000 units. The ownership of motor transfers to the appliance manufacture in Winnipeg. The question is which mode of transportation, truck or train, the appliance manufacture should use to bring the motors from Winnipeg to Toronto. The railroad company charges $2 per motor, and it takes approximately seven days by train. The trucking company charges $4 per motor, but it takes only three days. The appliance manufacturer will keep 1,000 units as safety stock if a truck is used and 3,000 units as safety stock if a train is used for transportation. If the holding cost rate is 25 percent of unit cost per uear, which mode of transportation will minimize total transportation and in-transit and safety holding cost?

Reference no: EM13841726

Questions Cloud

Minimize concerns about negligent hiring : Will you do a background investigation on applicants to minimize concerns about negligent hiring? If so, what type(s)? If not, why not?
Personality-values-perception and decision-making : If you were Dr. Bill Lamont, how would you handle this difficult situation? What factors do you need to consider when making a decision? How might you use emotional intelligence in this situation? Candi Cardigan, CARDWARE’s top model, requested Larry..
Optimal method of procuring an input : What is the impact of the following factors on the optimal method of procuring an input.
Balance sheet and financial ratio for season one of lemonade : Post your income statement, balance sheet and financial ratios for season one and two of your lemonade stand that are going to be used in your financial report
Total transportation and in-transit and safety holding cost : An appliance manufacture has a plant near Toronto that receives small electric motors from a manufacturer located in Winnipeg. The demand for the motors is 120,000 units per year. The cost of each motor is $120. If the holding cost rate is 25 percent..
Summarize the economic booms : 1. Based on research, summarize the economic booms that India and China enjoyed within the past few decades. What economic policies do they have in common?
What are some considerations that an organizational leader : What are some considerations that an organizational leader should contemplate prior to using political power that will impact organizational stakeholders?
Order processing and management-value delivery options : Please describe the following for the Target Corporation; Product and service specification. Order processing and management. Value delivery options. Procurement.

Reviews

Write a Review

 

Operation Management Questions & Answers

  What are the three sources of variability

What are the three sources of variability that are fundamental to operations management?

  What unmet needs of the customer

What unmet needs of the customer, or con-ditions in the apartment hunting and jobsearch processes, contributed to the successof Craigslist?

  1 an is the collection of individuals responsible for the

1. an is the collection of individuals responsible for the overall planning and development of the contingency

  Manage a hotel with one reception desk

You manage a hotel with one reception desk. On a typical day, you receive on average 8 customers per hour. It takes on average 6 minutes to check-in the customer. For the sake of this problem, we assume that checking-in ONLY happens daily between ..

  Economies of scale and efficiency

"Given all of the research that you have completed over the past several weeks," he says, "you should have most of the information you need to make a presentation to the board. The board doesn't want you to do any more research on all of the topic..

  What strategies are recommended for a firm

Using a Grand Strategy Matrix approach, what strategies are recommended for a firm that is a weak competitor in a slow-growing market? Elaborate on what these strategies could mean for a college or university.

  Discuss importance of employees and information technology

Discuss the importance of employees and information technology in the delivery of service quality. Use two examples of service firms to help support your discussion.

  Forbes school of business entrepreneurship scholarship

Throughout 2014, the Forbes School of Business at Ashford University is proud to offer $5,000 scholarships to students who exemplify the entrepreneurial spirit.

  Should there be greater government regulation with respect

Using article as a base, address explains how globalization affects: organizational behaviour, leadership also ethics. Word count one page this was already done.

  Explain what is meant by nervousness of the mrp schedule

Explain what is meant by nervousness of the MRP schedule. Provide an example. Name two tools that are particularly useful in reducing system nervousness in MRP systems.

  How information systems affect business careers

how information systems help to solve business problems; how information systems support major business functions, and how information systems affect business careers.

  Paul would be indifferent equals how many calzones

Paul Pananzzia, is considering a new pizza baking oven in which to cook the firms signature dish, calzone a la vegetarian. The new oven type A can handle 24 calzones an hour, Pauls fixed costs for equipment A is 25,000 and the variable cost is 3.00 p..

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