Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The demand for fruit juice of BluePrint Company is about 5,000 liters per year, and BluePrint can produce juice at the rate of 50,000

image text in transcribed

The demand for fruit juice of BluePrint Company is about 5,000 liters per year, and BluePrint can produce juice at the rate of 50,000 liters per year. Setup cost is $200. The unit cost is $8, and the inventory holding cost is 18 percent annually. If the demand for fruit juice exceeds the available inventory, it is backlogged. A backlog accrues two types of cost-loss of goodwill $0.05 per liter short and shortage penalty $9 per liter short per year. Calculate: Economic production quantity, the optimal maximum backorder level, Annual total cost of inventory. Cycle time, Time to produce Q units, Time to deplete maximum inventory. (9 points)

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

International Accounting

Authors: Frederick D. Choi, Gary K. Meek

6th edition

131588141, 978-0131588141

More Books

Students also viewed these Accounting questions