35. An item is used at a uniform rate of 50,000 units per year. No shortage is allowed and delivery is at an infinite rate. The ordering, receiving and handling cost is 13 per order, while inspection cost is 12 per order. Interest costs 20.056 and obsolescence costs 20.004 respectively per year for each item actually held in inventory plus 0.02 per year per unit based on the maximum number of units in inventory. Calculate EOQ If lead time is 20 days, find reorder level 1/GNOU MCA, 2003) Ons 5,590 units: 2,778 units) b7 36. A motor company purchases 9,000 motor spare parts for its annual requirement, ordering one month vasage at a time. Each spare part costs? 20. The ordering cost order is 2 15 and the carrying charges are 15% of the average inventory per year You have been asked to suggest more economical purchasing policy for the company. What advice would you offer and how much would it save the company per year? Dayalbagh Fide. Inst. Agra MBA May 2013: GNDU. B.Com April 2006 PTU B.Tech. Mech) May 2006; P.U. B.Com. 2002. 1999) Ans. Purchase 300 parts/ order, Annual savings 2 405) 37. Thompson Tooling has a department of Defence Contract for 1.50,000 bushings a year. Thompson orders the metal for bushings in lots of 40,000 units from a supplier It costs $ 40 to place an order and the estimated carrying charge is 20% of the unit cost, which is S 0.15. Thompson wants to know what per cent their order quantity varies from optimal and what this variation is costing them, if any. Hence calculate the extra cost incurred by Thompson for not ordering in optimal lots RCC CHD, 2002) An 50%. $ 150) 38 A manufacturer uses 25,000 worth of an item during the year. He has estimated the ordering cost as 50 per order and carrying costs as 12.5% of average inventory value. Find the optimal order size, number of orders per year, time period per order and total cost. [IGNOU MBA, 2002)