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. Sam s Cat Hotel operates 5 2 weeks per year, 6 days per week, and uses a continuous review inventory system. It purchases kitty
Sams Cat Hotel operates weeks per year, days per week, and uses a continuous review inventory system. It purchases kitty litter for $ per bag. The following information is available about these bags. Demand bagsweek Order cost $order Annual holding cost percent of cost Desired cycleservice level percent Lead time weeks working days Standard deviation of weekly demand bags Current onhand inventory is bags, with no open orders or backorders. a What is the EOQ? What would be the average time between orders in weeks b What should R be c An inventory withdrawal of bags was just made. Is it time to reorder? d The store currently uses a lot size of bags ie Q What is the annual holding cost of this policy? Annual ordering cost? Without calculating the EOQ, how can you conclude from these two calculations that the current lot size is too large? e What would be the annual cost saved by shifting from the bag lot size to the EOQ?
Sams Cat Hotel operates weeks per year, days per week, and uses a continuous review
inventory system. It purchases kitty litter for $ per bag. The following information is
available about these bags.
Demand bagsweek
Order cost $order
Annual holding cost percent of cost
Desired cycleservice level percent
Lead time weeks working days
Standard deviation of weekly demand bags
Current onhand inventory is bags, with no open orders or backorders.
a What is the EOQ? What would be the average time between orders in weeks
b What should R be
c An inventory withdrawal of bags was just made. Is it time to reorder?
d The store currently uses a lot size of bags ie Q What is the annual holding cost
of this policy? Annual ordering cost? Without calculating the EOQ, how can you conclude from
these two calculations that the current lot size is too large?
e What would be the annual cost saved by shifting from the bag lot size to the EOQ?
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