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Southeastern Lumber Mill processes 10,000 logs per year. As soon as the mill's supplier receives an order, they start delivering to the mill at a
Southeastern Lumber Mill processes 10,000 logs per year. As soon as the mill's supplier receives an order, they start delivering to the mill at a rate of 60 logs per day. The ordering cost incurred by the lumber mill is $1,600 per order and the holding cost of the unprocessed logs is $15 per log per year. Based on this information and the fact that the mill operates 250 days per year, answer the following questions. a) What is the optimal order quantity for Southeastern Lumber Mill? (round to the nearest whole number) b) What is the total cost of inventory associated with the optimal order quantity? (round to 2 decimal places) c) What is the number of operating days between orders? (round to 2 decimal places) d) How may operating days are required to receive an order? (round to 2 decimal places)
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