Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(Q2-Q6) LEE's Fantasy Co. produces ice cream bars for vending machine and has a daily demand for 200 bars. The company has the capacity to

image text in transcribed
(Q2-Q6) LEE's Fantasy Co. produces ice cream bars for vending machine and has a daily demand for 200 bars. The company has the capacity to produce 180,000 bars per year. The cost of setting up for the bar production is $7.50, and the firm is reluctant to produce too many at one time because the storage cost(refrigeration) is relatively high at 30 percent of the actual bar price. Each ice cream bar is expected to sell at $5.00. The firm supplies vending machines with its "Fantasy Bars" on 360 days of the year at Rowan (Choose the nearest value up to 2 decimal points from the given answers). 3 pts. each _02. What is the most economical lot size to produce (1.c. ERL) _03. What is the average inventory level (units)? _04. What is the total inventory carrying cost of bars per bar-year? _05. What is the total inventory cost (ie total set-up cost and total carrying cost)? _06. What is the optimal length of the production run in days (i.e., Number of days for production)? (4 pts.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Dcaa Audits Widespread Problems With Audit Quality Require Significant Reform: Gao 09 1009t

Authors: U. S. Government Accountability Office

1st Edition

1287232027, 978-1287232025

More Books

Students also viewed these Accounting questions

Question

1. Discuss the four components of language.

Answered: 1 week ago

Question

a. How many different groups were represented?

Answered: 1 week ago