Produce distributor uses non-returnable packing crates

Assignment Help Operation Management

Reference no: EM13992292

A fresh produce distributor uses 800 non-returnable packing crates a month, which it purchases at a cost of $5 each. The manager has assigned an annual holding cost of 25 percent of the purchase price per crate. Ordering cost is $28 per order. Currently the manager orders 800 crates at a time. How much could the firm save annually in ordering and holding costs by using the EOQ?

Reference no: EM13992292

Questions Cloud

Explain the importance of identifying individual performance : Explain the importance of identifying individual performance deficiencies and developmental needs in planning and developing training and HRD programs.

Company is about to begin production of a new product : A company is about to begin production of a new product. The manager of the department that will produce one of the components for the product wants to know how often his machine will be available for other work. What production run quantity should b..

What takt time would match capacity and demand : What takt time would match capacity and demand if demand is 120 units a day, there are two shifts of 480 minutes each, and workers are given three half-hour breaks during each shifts, one of which is for lunch or diner?

Particular product in an assembly-line operation : The universal Manufacturing Co. produces a particular product in an assembly-line operation. One of the machines on the line is a drill press that has a single assembly line feeding into it. A partially completed unit arrives at the press to be worke..

Produce distributor uses non-returnable packing crates : A fresh produce distributor uses 800 non-returnable packing crates a month, which it purchases at a cost of $5 each. The manager has assigned an annual holding cost of 25 percent of the purchase price per crate. Ordering cost is $28 per order. Curren..

Determine the average time a ticket buyer : The ticket booth on the Tech campus is operated by one person, who is selling tickets for the annual Tech versus State football game on Saturday. The ticket seller can serve an average of 12 customers per hour (Poisson distributed); on average, 8 cus..

Calculate the optimal production run quantity : A sausage factory can produce European wieners at a rate of 500 kg per day. It supplies wieners to local stores and restaurants at a steady rete of 100 kg per day. The cost to prepare the equipment for producing European wieners is $12. Annual holdin..

Consumer behavior or important issues in society affected : In what ways if any has the media's agenda-setting power on public perceptions, consumer behavior or important issues in society affected you or someone close to you? Is there anything you could or would want to do about that impact? Explain your ans..

Calculate total annual cost of ordering and holding flour : A large bakery buys flour in 25 kg bags. The bakery uses an average of' 4,860 bags a year. Preparing an order and receiving a shipment of flour bags involves a cost of $10 per order. Annual holding cost is $5 per flour bag. Determine the economic ord..

User Account

All Pages