Carpet City orders Soft Shag from the Carpet City Mill. The production rate at the mill is 1200 yards per day, and the mill operates 260 days per year. The annual carrying cost is $0.63, the order cost is $425, and a lead time for receiving an order is 7 days.

b) Compute the optimal order quantity, the total monthly and annual minimum inventory cost, and the reorder point.

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Question 2 Carpet City orders Soft Shag from the Carpet City Mill. The production rate at the mill is 1200 yards per day, and the mill operates 260 days per year. The annual carrying cost is $0.63, the order cost is $425, and a lead time for receiving an order is 7 days. a) Use a 3-month moving average to forecast a value for Month 9. Use this forecast as the demand, with a daily demand assuring this is for September --- a 30-day month. b) Compute the optimal order quantity, the total monthly and annual minimum inventory cost, and the reorder point. Month 1 2 3 3- Month Demand Moving Average 8,000 12,000 7,000 9,000 15,000 11,000 10,000 12,000 4 S 6 7 8 9 b) yards per month or yards per day Demand = Order costs, Annual carrying costs, Monthly carrying costs, C. Lead time- Production, p = yards per day What is the optimal order quantity? 0 = 1 yards What is the monthly total minimum inventory cost? TC What is the annual total minimum inventory cost? TC What is the reorder point? R- Ivards Question 2 Carpet City orders Soft Shag from the Carpet City Mill. The production rate at the mill is 1200 yards per day, and the mill operates 260 days per year. The annual carrying cost is $0.63, the order cost is $425, and a lead time for receiving an order is 7 days. a) Use a 3-month moving average to forecast a value for Month 9. Use this forecast as the demand, with a daily demand assuring this is for September --- a 30-day month. b) Compute the optimal order quantity, the total monthly and annual minimum inventory cost, and the reorder point. Month 1 2 3 3- Month Demand Moving Average 8,000 12,000 7,000 9,000 15,000 11,000 10,000 12,000 4 S 6 7 8 9 b) yards per month or yards per day Demand = Order costs, Annual carrying costs, Monthly carrying costs, C. Lead time- Production, p = yards per day What is the optimal order quantity? 0 = 1 yards What is the monthly total minimum inventory cost? TC What is the annual total minimum inventory cost? TC What is the reorder point? R- Ivards