Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bruno Fruscalzo decided to start a small production facility in Sydney to sell gelato to the local restaurant local milk supplier charges $0.5 per

Bruno Fruscalzo decided to start a small production facility in Sydney to sell gelato to the local restaurant local milk supplier charges $0.5 per kg of milk plus a $25 delivery fee (that is independent of the amount ordered). Bruno's holding cost is $0.04 per kg per month. He needs 8000 kgs of milk per month. a. b. C. d. e. f. g. Suppose Bruno orders 8500 kgs each time. What is his average inventory (kgs)? (Round your answer to 1 decimal place.) Suppose Bruno orders 6250 kgs each time. How many orders does he place with his supplier each year? How many kgs should Bruno order from his supplier with each order to minimize the sum of ordering and holding costs? (Do not round intermediate calculations. Round your answer to 2 decimal places.) If Bruno's storage vessel can hold only 2000 kgs of milk, what would be Bruno's annual ordering and holding costs? (Do not round intermediate calculations. Round your answer to 2 decimal places.) If Bruno's storage vessel can hold only 7000 kgs of milk, what would be Bruno's annual ordering and holding costs? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Bruno's supplier's truck can carry 20,000 kgs of milk. The supplier does not want to deliver to more than 3 customers with each truck. Thus, the supplier requires a minimum order quantity of 6,500 kgs. If Bruno orders the minimum amount, what would be the sum of his annual ordering and holding costs? Assume he has a storage vessel large enough to hold 6,500 kgs. (Round your answer to 3 decimal places.) Bruno's supplier offers a 4% discount when a customer orders a full truck, which is 20,000 kgs. Assume Bruno can store that quantity and the product will not spoil. If Bruno orders a full truck, what would be the inventory holding and ordering cost incurred per kg of milk? Assume the discount also applies to the holding cost.

Step by Step Solution

3.37 Rating (150 Votes )

There are 3 Steps involved in it

Step: 1

To solve the given problems well need to perform various calculations based on the provided information Lets go through each question step by step a Average Inventory If Bruno orders 8500 kgs each tim... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Matching Supply with Demand An Introduction to Operations Management

Authors: Gerard Cachon, Christian Terwiesch

3rd edition

73525200, 978-0073525204

More Books

Students also viewed these General Management questions