Microbrewery production-what would joe total annual cost

Assignment Help Operation Management
Reference no: EM131784573

Joe Birra needs to purchase malt for his microbrewery production. His supplier charges $35 per delivery (no matter how much is delivered) and $1.20 per gallon. Joe’s annual holding cost per unit is 35 percent of the price per gallon. Joe uses 250 gallons of malt per week.

A. Suppose Joe orders the quantity from part (C) that minimizes the sum of the ordering and holding costs each time he places an order with the supplier. What is the annual cost of the EOQ expressed as a percentage of the annual purchase cost?

B. If Joe’s supplier only accepts orders that are an integer multiple of 1000 gallons, how much should Joe order to minimize ordering and holding costs per gallon?

C. Joe’s supplier offers a 3 percent discount if Joe is willing to purchase 8000 gallons or more. What would Joe’s total annual cost (purchasing, ordering, and holding) be if he were to take advantage of the discount?

Reference no: EM131784573

Questions Cloud

Sun best could use a gantt chart to help coordinate pilots : Determine how Sun Best could use a Gantt chart to help coordinate pilots, flight attendants, and daily flights.
Server queuing system with infinite calling population : A single-server queuing system with an infinite calling population and a first-come, first-served queue discipline has the following arrival and service rates:
Competitive rivalry among industry member firm : Identify five factors that tend to weaken the intensity of competitive rivalry among an industry's member firm.
Unethical managerial and business behavior : Identify and briefly describe the three main drivers of unethical strategies and unethical managerial and business behavior.
Microbrewery production-what would joe total annual cost : Joe Birra needs to purchase malt for his microbrewery production. What would Joe’s total annual cost be if he were to take advantage of the discount?
Examples of hidden costs of employee turnover : Interviewing and training time are examples of hidden costs of employee turnover.
Analyze the market positioning of the firm : International Market Analysis: Analyze the market positioning of the firm in one foreign market. Examples of foreign markets can be found in the firm's annual.
What are the human resource functions : What are the Human Resource Functions and provide an example of each function?
Inventory turnover in a food service operation : For which food category should inventory turnover in a food service operation be highest?

Reviews

Write a Review

Operation Management Questions & Answers

  Exponential smoothing with trend to forecast monthly demand

A manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. At the end of December, the company wishes to forecast sales for January

  Guarantee flow of ideas among employees during his meetings

John wants to guarantee a flow of ideas among employees during his meetings. Which of the following would be the MOST effective?

  The roles and responsibilities of managers and leaders are

the roles and responsibilities of managers and leaders are closely intertwined and related however a manager is not

  Illustrate difference does it make if a consumer desires

Illustrate what difference does it make if a consumer desires a 10,000-unit order produced also delivered all at one time or in 2,500 - unit batches.

  Evaluate the organizations productivity

In the Middleboro Physician Care Services, Inc. case, you are asked to examine the operations of an ambulatory, non-emergent care clinic which treats private and occupational health patients and provides services which do not include continuing o..

  Illustrate what are the spi also cpi

The foreman estimates which the value of the work actually finished is about $162, 000. Illustrate what are the spending also schedule variances for the project. Illustrate what are the SPI also CPI.

  Leaders are ambassadors of team based change effects

Explain the idea that "leaders are ambassadors of team based change effects."

  What are challenges of developing a global code of ethics

What are challenges of developing a global code of ethics? What is the UN Global Compact and its principles? What are guidelines for multinational corporations? What are responsibilities of an ethics officer?

  What problems do you anticipate as the plan takes effect

What particular guidelines will you follow to ensure that it is effective in motivating employees? What problems do you anticipate as the plan takes effect?

  Experienced customer service representatives

Your employees are skilled and experienced customer service representatives who perform nonroutine tasks,

  Treating risk-risk control and risk financing differ

How do the two basic methods of treating risk-risk control and risk financing differ? Why is risk avoidance not a practical solution to many risks? Why might inadequate planning cause a client to retain pure risk?

  Differentiate between venture capitalists and angels

What is the private equity market? How does it differ from other funding sources? Identify three different kinds of investors in the private equity market. Differentiate between venture capitalists and angels.

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