Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Mama Leone's Frozen Pizzas uses 49,000 pounds of cheese per year. Each pound costs $5.50. The ordering cost for the cheese is $1310.00 per order,
Mama Leone's Frozen Pizzas uses 49,000 pounds of cheese per year. Each pound costs $5.50. The ordering cost for the cheese is $1310.00 per order, and its carrying cost is
$2.62 per pound per year. Calculate the firm's economic order quantity (EOQ) for the cheese. Mama Leone's operates 220 days per year and maintains a minimum inventory level of 22 days' worth of cheese. Assuming that the lead time to receive orders of cheese is 33 days, calculate the reorder point .
The EOQ that minimizes the total inventory costs is __ pounds of cheese.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started