Buffalo Falls Ltd manufactures among other things, glass table tops. It uses a just-in-time system of production for its table tops. However it orders the glass used in production in bulk. The glass takes up a lot of space in the companys warehouse, and often is damaged during storage. Consequently Buffalo Falls has decided to trial a Just-in-Time (JIT) purchasing system. The following data relate to this system. Demand for table tops is estimated to be 9,000 units for the coming year. Currently, each table top requires on average a sheet of glass. This includes an amount for scrap and reworks. Under the JIT system, scrap and reworks are expected to be minimal; therefore only 1/3 a sheet of glass is expected to be used per table top. (one) Each sheet of glass currently costs $60. This will not change under JIT. Currently Buffalo Falls orders glass in lots of 1,000 sheets. With the introduction of JIT this will fall to 50 sheets. Each order costs $100, but will fall by 50% under JIT. Damaged inventory is estimated to be on average $5 per average unit held. This will not be incurred under JIT. Other carrying costs amount to $60 per unit. This will not change if JIT is introduced. Buffalo Falls will not need as much warehouse space, therefore will lease 75% of an existing warehouse to another firm for $2 per square metre. The warehouse has 30,000 square metres. (five) Three employees who currently earn $30,000 each will be directly affected by the just-in-time adoption decision. Two will be transferred to other positions within Buffalo Falls; one will be fired. (six) Buffalo Falls expects that it will lose sales amounting to 250 table tops with the introduction of JIT. Selling price of these items will be $200 per item, and variable costs per item will be $60 and fixed costs will be $20 per item. (eight) Assume Buffalo Falls has a required rate of return of 30% per annum. Required: a) Calculate the Economic Order Quantity for glass. b) Calculate total annual cost of ordering and carrying the glass. c) Should Buffalo Falls implement its just-in-time inventory policy? Show all calculations. d) Adoption of a just-in-time inventory system will often result in less need for inspection of incoming materials and parts. Explain why