Amazon sells 20,000 units of consumer electronics from Samsung every month. Each unit costs $100 and Amazon has an annual holding cost of 26% percent. The fixed clerical and transportation cost for each order Amazon places is $4,000.

On the other hand, to fulfill every order, Samsung incurrs a fixed cost of $2,000, and the unit production cost for Samsung is $50. Samsung has a holding cost of 30%.

PLEASE SHOW SOLUTIONS WITH EXCEL FORMULAE

  1. 

1. What is the optimal size of the order that Amazon should place with Samsung? What is the total inventory holding and ordeirng cost for Amazon? Annual demand D= Unit cost Cr= Ordering cost Sr= Holding cost %= Unit holding cost Hr= Optimal EOQ= Annual ordering cost- Annual holding cost= Total annual cost= (only include inventory holding cost and ordering cost) 2. With the optimal order size placed by Amazon, what is the total inventory holding and ordeirng cost for Samsung? What is the total supply chain cost? Annual demand D= Optimal order size= Ordering cost Sm= Holding cost %= Unit holding cost Hm= Annual ordering cost- Annual holding cost= Total annual cost= Total supply chain cost- (only include inventory holding cost and ordering cost) 3. In order to minimize the total supply chain cost for handling this product, What is the optimal ordering quantity (EOQ)? What is the total inventory holding and ordeirng cost for Samsung (based on the new EOQ)? Annual demand D= Supply chain ordering cost S= Supply chain holding cost H= EOQ= Annual SC holding cost= Annual SC ordering cost- Annual SC cost= Samsung annual holding cost- Samsung annual ordering cost= (only include inventory holding cost and ordering cost)