Your company assembles five different models of a motor scooter that is sold in specialty stores in the United States The company uses the same engine for all five models You have been given the assignment of choosing a supplier for these engines for the coming year Due to the size of your warehouse and other administrative restrictions, you must order the engines in lot sizes of 850 units Because of the unique characteristics of the engine, special tooling is needed during the manufacturing process for which you agree to reimburse the supplier Your assistant has obtained quotes from two reliable engine suppliers and you need to decide which to use The following data have been collected Requirements (annual forecast) 10,200 units Weight per engine 20 pounds Order Process Inventory $160 per order Inventory Carry Cost 20 percent the average value of inventory per year Note Assume that half of the lot size is in inventory, on average (850 2 425 units) Two qualified suppliers have submitted the following quotations Order Quantity Supplier 1 unit price Supplier 2 unit price 1 to 1,499 units order $702 $700 1,500 to 2,999 units order 692 698 3,000 to units order 682 681 Tooling costs $26,820 $23,400 Distance 115 miles 100 miles Your assistant has obtained the following freight rates from your carrier Truckload (43,000 lb each load) $0 80 per ton mile Less than truckload $1 20 per ton mile Note Per ton mile 2,000 lb per mile a 1 Calculate the total cost for each supplier (Round your answers to the nearest whole number ) b 1 If you could move the lot size up to ship in truckload quantities, calculate the total cost for each supplier (Do not round intermediate calculations Round Required lot size for truckload and final answers to the nearest whole number ) HINT Use (full) truckload cost rates and the lowest (feasible) unit cost for all calculations For example, if there are 8 3 orders per year, dont split the 8 3 orders into 8 full truckloads and 0 3 less than truckloads use the full truckload rate for all 8 3 orders For annual purchase cost, dont use two different unit costs for the 8 complete orders and the 0 3 partial orders use the lowest (feasible) unit cost for all 8 3 purchase orders based on the lot size needed for a full truckload

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Your company assembles five different models of a motor scooter that is sold in specialty stores in the United States. The company uses the same

Your company assembles five different models of a motor scooter that is sold in specialty stores in the United States. The company uses the same engine for all five models. You have been given the assignment of choosing a supplier for these engines for the coming year. Due to the size of your warehouse and other administrative restrictions, you must order the engines in lot sizes of 850 units. Because of the unique characteristics of the engine, special tooling is needed during the manufacturing process for which you agree to reimburse the supplier. Your assistant has obtained quotes from two reliable engine suppliers and you need to decide which to use. The following data have been collected:

Requirements (annual forecast)	10,200 units
Weight per engine	20 pounds
Order Process Inventory	$160 per order
Inventory Carry Cost	20 percent the average value of inventory per year

Note: Assume that half of the lot size is in inventory, on average (850/2 = 425 units). Two qualified suppliers have submitted the following quotations:

Order Quantity	Supplier 1 unit price	Supplier 2 unit price
1 to 1,499 units/order	$702	$700
1,500 to 2,999 units/order	692	698
3,000 to units/order	682	681
Tooling costs	$26,820	$23,400
Distance	115 miles	100 miles

Your assistant has obtained the following freight rates from your carrier:

Truckload (43,000 lb. each load)	$0.80 per ton-mile
Less-than-truckload	$1.20 per ton-mile

Note: Per ton-mile = 2,000 lb. per mile. a-1. Calculate the total cost for each supplier. (Round your answers to the nearest whole number.) b-1. If you could move the lot size up to ship in truckload quantities, calculate the total cost for each supplier. (Do not round intermediate calculations. Round "Required lot size for truckload" and final answers to the nearest whole number.) HINT: Use (full) truckload cost rates and the lowest (feasible) unit cost for all calculations. For example, if there are 8.3 orders per year, dont split the 8.3 orders into 8 full truckloads and 0.3 less-than-truckloads - use the full truckload rate for all 8.3 orders. For annual purchase cost, dont use two different unit costs for the 8 complete orders and the 0.3 partial orders use the lowest (feasible) unit cost for all 8.3 purchase orders based on the lot size needed for a full truckload.