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Q. South-eastern Bell stocks a certain switch box at its central warehouse for supplying field service offices. The yearly demand for these connectors is 15,000 units. South-eastern estimates its annual holding costs for this item to be $25 per unit. The cost to place also process an order from the supplier is $75. The organization operates 300 days per year also the lead-time to receive an order from the supplier is 8 working days.
(a) Find out the economic order quantity.
(b) Find out the annual holding costs.
(c) Find out the annual ordering costs.
(d) Illustrate what is the reorder point?
Illustrate what order size would minimize total inventory costs. Illustrate what are total costs of inventory. Office manager is presently using an order size of 200 packages.
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