Determine the optimal order quantity

Assignment Help Operation Management
Reference no: EM13959103

An office furniture company sells 5,500 chairs of a popular style per year. Chairs are produced the company’s factory. The comptroller has estimated the inventory cost rate at 0.4 per year. Labor, mail, and receiving costs per order are estimated at $125. Additionally, for each order the factory must setup the machines to produce the requested amount. Each setup costs $235 and takes two hours. Each unit requires one hour of processing time. Each chair is comprised of $20 of purchased material and $25 of value added. Throughput time in the plant is approximately five times total processing time. Determine the optimal order quantity. Assume that the plant operates 2,500 hours per year.

Reference no: EM13959103

Questions Cloud

How to open web pages in java as a string : How to open Web pages in Java as a string? Open a given Web page as its source file.
Cost percentage of deaths : Cost Percentage of Deaths at 70 mph $20 80% $50 60% $70 30% $150 10% $500 5% You are members of a research and development department of a corporation that produces child car-safety seats. How much in your estimation would you be willing to pay for a..
What would be the correct ethical behavior in such context : Once locations have been chosen, firms need to build the requisite competencies at those locations. The more a business depends on a particular location, the greater the need to have world-class competencies in the relevant activities that take place..
Make the journal entries : July journal transcation, make the journal entries.
Determine the optimal order quantity : An office furniture company sells 5,500 chairs of a popular style per year. Chairs are produced the company’s factory. The comptroller has estimated the inventory cost rate at 0.4 per year. Each unit requires one hour of processing time. Each chair i..
Why are these two roles typically separated : The chapter notes that in 2010, in roughly two-thirds of U.S. firms, the CEO is also the chair of the board of directors. More broadly this can be viewed as an intermingling of management and ownership. Why are these two roles typically separated? Is..
Developing management capability : The aim of this assignment is to allow participants to explore and develop key capabilities in one of the two key managing others capabilities addressed in the course.
Find the optimal order quantity and annual cost : A plant purchases 150,000 units of an electrical component per year. The fixed ordering cost is $60. The unit cost is $0.25 if ordered in quantities less than 1000, $0.24 if order size is between 1,000 and 15,000, and $0.23 for orders of 15,000 or mo..
Roi for laundry mate products and comment on the company : Calculate NOPAT, invested capital, and ROI for Laundry Mate Products, and comment on the company's profitability.

Reviews

Write a Review

Operation Management Questions & Answers

  What is the total inventory in department b

What is the total inventory in department B (store 3, process 3, store 4, and process 4

  Perform reliably during a one-hour exam

Assuming that a new battery has just been installed and the student brings one spare, fully charged battery with him, what is the probability that the laptop will perform reliably during a one-hour exam?

  Considered the various elements of the research project

Weekly tasks or assignments (Individual or Group Projects) will be due by Monday, and late submissions will be assigned a late penalty in accordance with the late penalty policy found in the syllabus. NOTE: All submission posting times are based o..

  Which plan will provide the higher reliability

Which plan will provide the higher reliability? Explain why the two reliabilities are not the same. What other factors might enter into the decision of which plan to adopt?

  Which green strategy makes the most sense for p&g

Can established competitors be beaten at their own game? (In other words, should P&G be confident in its ability to compete in the green markets?)

  Variables-objective function and constraints

Green Vehicle Inc., manufactures electric cars and small delivery trucks. It has just opened a new factory where the C1 car and the T1 truck can both be manufactured. Formulate the linear program that provides the combination of T1 and C1 that maximi..

  Verify the prospective partners capabilities

approach prospective clients to get their perpective on the agreement and esure that there is a market for the new technology they want to develop.

  Capture the knowledge that works have about their jobs

The workplace is becoming more complex and diverse and requires managers to be creative in finding ways the bring about a competitive advantage. What things can you as a health care manager, do to capture the knowledge that works have about their job..

  Under what circumstances does requesting cost

Under what circumstances does requesting cost or pricing data help the government or work against the government? How so?

  Blending the firm''s promotion efforts

A company provides its advertising agency with a statement about a new product to use in designing an advertising campaign, and this statement includes a description of the target market, the product type, the primary benefits of using the product..

  Determine each alternative’s break-even point in units

A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two alternatives, A and B, have been identified, and the associated costs and revenues have been estimated. Determine each alternative’s break-even point..

  Human capital for innovation and competitive advantage

Ngah and Ibrahim remark that to refine their objectives and increase their success in operating their business, small or medium enterprises (SME) must understand their own capabilities, especially their internal strengths. Their people, practices, an..

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