Inventory Management Exercises (2).xlsx

Inventory Management Exercises (2).xlsx - LOT SIZING WITH...

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60 24 $ 250 $ 250 $ 10,000.00 $ 10,000.00 $ 800 25% Truck capacity = 12.00 Annual demand for Large customer, D L = Annual demand for Medium customer, D M = Customer specific delivery cost, s L = Customer specific delivery cost, s M = Unit Cost, C L = Unit Cost, C M = Common delivery cost, S = Annual interest rate, i = LOT SIZING WITH MULTIPLE PRODUCTS OR CUSTOMERS TopOil, a refiner in Indiana, serves two customers near Nashville, Tennessee, and maintains consignment inventory (owned by TopOil) at each location. Currently, TopOil uses TL (truckload) transportation to deliver separately to each customer. Each truck costs $800 plus $250 per stop. Thus delivering to each customer separately costs $1,050 per truck. Annual demand for each customer is given below (in tons per year). Product cost for TopOil is $10,000 per ton and they use an interest rate of 25% for inventory holding cost. Truck capacity is 12 tons. Answer questions (i) and (ii) on the right.
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Ship Full Truckloads independently (HINT: Start with Quantity) Holding Cost Total cost Large $ - Medium $ - $ -
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