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The second product is B202. Demand data for Product B202 for the first twelve weeks of the year are provided below in the Random
The second product is B202. Demand data for Product B202 for the first twelve weeks of the year are provided below in the Random Number Table. WK1 WK2 WK3 WK4 A,B,C 91 120 115 102 D,E,F 97 105 115 90 100 WK5 WK6 WK7 103 118 100 120 103 WK8 G,H 100 114 119 100 116 WK9 WK10 WK11 100 104 91 99 92 120 105 100 116 96 WK12 117 96 102 91 110 109 94 LJ 92 102 98 110 106 118 117 96 106 110 116 120 K,L 111 109 100 101 102 107 117 100 114 120 M,N 99 104 90 102 107 111 104 97 97 100 66 93 99 91 114 O,P 102 115 105 107 103 109 101 99 117 113 116 6 96 Q,R 97 101 97 90 97 118 109 110 118 118 110 106 S,T U,V W,X Y,Z 96 6696 93 99 98 115 108 96 99 95 90 105 108 119 94 93 109 92 107 92 95 92 99 113 114 96 92 109 110 118 100 97 113 116 110 106 115 117 93 116 104 109 112 101 110 112 104 107 110 Annual demand has been estimated to be 5200. Currently, the company uses a lot size of 200 units, and there is a lead time of 2-weeks. Deliveries are received on the first day of the week and are included in the calculation of the week's beginning inventory. The first delivery for the year is received on Monday of Week 1. The unit cost of B202 is $16. Ordering cost is $20 per order, and monthly holding cost is 25% of product cost. Stockout cost is estimated to be $25 per unit. a. Use the Random Number General Table to simulate Week 1 to Week 12 demand for B202 using the first 12 letters of your name (Surname Middle Name (or Nick Name) - First Name) SHOW YOUR WORKING (1 mark) b. Evaluate the company's current ordering strategy for B202. In your answer, compare the theoretical costs versus actual inventory costs for the first 12-weeks for the year. (10 marks) c. Recommend an ordering strategy for B202, giving a rationale for your recommendation. (4 marks)
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