Jill's Job Shop buys two parts (Tegdiws and Widgets) for use in its production system from two different suppliers. The parts are needed throughout the entire 52-week year. Tegdiws are used at a relatively constant rate and are ordered whenever the remaining quantity drops to the reorder level. Widgets are ordered from a supplier who stops by every three weeks. Data for both products are as follows:

a. What is the inventory control system for Tegdiws? That is, what is the reorder quantity and what is the reorder point?

b. Find the total inventory costs if using inventory policy.

This is a case considering safety stock (Use the correct formulas)

ITEM	TEGDIW	WIDGET
Annual Demand	10,000	5,000
Holding cost (% of item cost)	20%	20%
Set up or order cost	$150.00	$25.00
Lead Time	4 weeks	1 week
Safety stock	55 units	5 units
Item cost	$10.00	$2.00