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A company begins a review of ordering policies for its continuous review system by checking the current policies for a sample of SKUs. Following are
A company begins a review of ordering policies for its continuous review system by checking the current policies for a sample of SKUs. Following are the characteristics of one item. Refer to the standard normal table LOADING... for zvalues.
Demand Dunitsweek Assume weeks per year
Ordering and setup costS$order
Holding costH$unityear
Lead timeL weeks
Standard deviation of weekly demand units
Cycleservice level percent
Part
a What is the EOQ for this item? units. Enter your response rounded to the nearest whole number.
Part
b What is the desired safety stock? enter your response here units. Enter your response rounded to the nearest whole number.
Part
c What is the reorder point? enter your response here units. Enter your response rounded to the nearest whole number.
Part
d What are the cost implications if the current policy for this item is Q and R
The annual ordering cost is $enter your response here enter your response rounded to two decimal places and the annual holding cost is $enter your response here enter your response rounded to two decimal places
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