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OBJECTIVE Exercise 20.10 EOQ with Setup Costs Morrison Manufacturing produces casings for sewing machines: large and small. To produce the different casings, equipment must be
OBJECTIVE Exercise 20.10 EOQ with Setup Costs Morrison Manufacturing produces casings for sewing machines: large and small. To produce the different casings, equipment must be set up. The setup cost per production run is $18,000 for either casing. The cost of carrying small casings in inventory is $6 per casing per year; the cost of large casings is S18 per unit per year. To satisfy demand, the company produces 2,400,000 small casings and 800,000 large casings. Required 1. Compute the number of small casings that should be produced per setup to minimize total setup and carrying costs. 2. Compute the setup, carrying, and total costs associated with the economic order quantity for the small casings. OBJECTIVE Exercise 20.11 EOQ with Setup Costs Refer to Exercise 20.10. Required . Compute the number of large casings that should be produced per setup to minimize total setup and carrying costs for this product. 2. Compute the setup, carrying, and total costs associated with the economic order quantity for the large casings What is the reorder point assuming that safety stock is carried OBUECTIVE EOO with Setup Costs Exercise 20.10 Morrison Manufacturing produces casings for sewing machines: large and small. To produce the different casings, equipment must be set up. The setup cost per production run is $18,000 for either casing. The cost of carrying small casings in inventory is $6 per casing per year, the cost of large casings is SIS per unit per year. To satisfy demand, the company produces 2.400,000 small casings and 800.000 large casings. Required 1. Compute the number of small casings that should be produced per setup to minimize total setup and carrying costs. 2. Compute the setup, carrying, and total costs associated with the economic order quantity for the small casings. OBJECTIVE Exercise 20.11 EOQ with Setup Costs Refer to Exercise 20.10 Required: 1. Compute the number of large casings that should be produced per setup to minimize total setup and carrying costs for this product. Compute the setup, carrying, and total costs associated with the economic order quantity for the large casings. 2
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