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# HW_8 - setup cost to produce Super Green is \$300 Annual...

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1. Problem 12: (4 POINTS) a. Calculate EOQ b. Calculate Total annual cost c. Calculate Reorder point d. Describe this inventory policy 2. Problem 14: (3 points) a. Calculate EOQ at different price to see if a feasible solution can be found b. Calculate Total Cost c. Describe inventory policy 3. (3 points) Good Garden Company (GGC) produces a high-quality organic lawn food and weed eliminator called Super Green (SG). Super Green is sold in 50-pound bag. Monthly demand for Super Green is 75,000 pounds. GGC has capacity to produce 24,000 50-pound bags per year. The
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Unformatted text preview: setup cost to produce Super Green is \$300. Annual holding cost is estimated to be \$3 per 50-pound bag. Currently, SG is producing in batches of 2500 bags. a) Calculate the total annual costs of the current operating policy at GGC (hint: current Q=2500 bags) b) Calculate the EPQ, total costs of the EPQ policy, describe the policy c) Calculate the penalty cost incurred with the present policy...
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