Question
Question Asked by noumanzamurd A local company produces a programmable EPROM (erasable... A local company produces a programmable EPROM (erasable programmable read-only memory) for several
Question
Asked by noumanzamurd
A local company produces a programmable EPROM (erasable...
A local company produces a programmable EPROM (erasable programmable read-only memory) for several industrial clients. They have experienced a relatively flat demand of 2500 units per year for the product. The EPROM is produced at a rate of 10000 units per year. Company has a steady rate of daily production. The accounting department has estimated that it costs $50 to initiate a production run, each unit costs the company $2 to manufacture, and the cost of holding is base on a 30% annual interest rate. Company working 250 working days in a year. Determine the optimal size of a production run, the length of each production run, and the total cost of production. How many inventory is being sold during production time? What is the cycle time? What is the number of production runs during a year? What is the maximum level of on-hand inventory of the EPROMs?
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