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Jimmy Changa's makes entre items to supply to the Mexican restaurant trade. They are looking to optimize the inventory management of bags of corn flour
Jimmy Changa's makes entre items to supply to the Mexican restaurant trade. They are looking to optimize the inventory management of bags of corn flour they use for tortillas and tacos. The use 1,600 bags of flour per year, each at a price of $80. The carrying costs of holding inventory amount to 25% of the value of inventory on hand. Each time they place an order it costs $40 in ordering and delivery fees, and the order takes 9 days to arrive. They use the inventory on a 360-day year basis. The formula for EOQ tells them that each order is best sized at 80 bags per order. Calculate a) the reorder point (ROP) in whole number of bags and b) the number orders they will place in a year. Give your answer as a whole (rounded up) number, with no decimals. ROP is at bags remaining in inventory They place per year
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