# Inventory models for independent demand difficult

• mtr27
• 597
• 88% (107) 94 out of 107 people found this document helpful

This preview shows page 331 - 334 out of 597 pages.

##### We have textbook solutions for you!
The document you are viewing contains questions related to this textbook. The document you are viewing contains questions related to this textbook.
Chapter 6 / Exercise 040
College Algebra
Larson Expert Verified
(Inventory models for independent demand, difficult) {AACSB: Analytic Skills} 130.Given the following data: D=65,000 units per year, S = \$120 per setup, P = \$5 per unit, and I = 25% per year, calculate the EOQ and calculate annual costs following EOQ behavior. EOQ is 3533 units, for a total cost of \$4,415.88 7.3532525.120650002*Q88.441594.220794.2207525.235331203533650002HQSQDTC(Inventory models for independent demand, moderate) {AACSB: Analytic Skills}
##### We have textbook solutions for you!
The document you are viewing contains questions related to this textbook. The document you are viewing contains questions related to this textbook.
Chapter 6 / Exercise 040
College Algebra
Larson Expert Verified
332 131.A toy manufacturer makes its own wind-up motors, which are then put into its toys. While the toy manufacturing process is continuous, the motors are intermittent flow. Data on the manufacture of the motors appears below. Annual demand (D) = 50,000 units Daily subassembly production rate = 1,000 Setup cost (S) = \$85 per batch Daily subassembly usage rate = 200 Carrying cost = \$.20 per unit per year a. To minimize cost, how large should each batch of subassemblies be? b. Approximately how many days are required to produce a batch? c. How long is a complete cycle? d. What is the average inventory for this problem? e. What is the total inventory cost (rounded to nearest dollar) of the optimal behavior in this problem? (a) 7.7288)1000/2001(*2.85*50000*2)/1(2*pdHDSQPor 7289 units. (b) It will take approximately 7289/ 1000 = 7.3 days to make these units. (c) A complete cycle will last approximately 7289 / 200 = 36 days. (d) The maximum inventory level is 5831100020017.72881pdQunits. Average inventory is 5831 / 2 = 2,915 (not one-half of 7283). (e) Total inventory management costs are 19.166,1\$09.58309.5832.2583185728950000TC(Inventory models for independent demand, moderate) {AACSB: Analytic Skills} 132.Louisiana Specialty Foods can produce their famous meat pies at a rate of 1650 cases of 48 pies each per day. The firm distributes the pies to regional stores and restaurants at a steady rate of 250 cases per day. The cost of setup, cleanup, idle time in transition from other products to pies, etc., is \$320. Annual holding costs are \$11.50 per case. Assume 250 days per year. a. Determine the optimum production run. b. Determine the number of production runs per year. c. Determine maximum inventory. d. Determine total inventory-related (setup and carrying) costs per year. (a) 7.2024)1650/2501(*5.11320*62500*2)/1(2*pdHDSQPor 2025 cases. (b) There will be 62,500 / 2024.7 = 30.87 runs per year. (c) The maximum inventory level is 9.1717165025017.20241pdQunits. (d) Total inventory management costs are 09.756,19\$04.987804.98785.1129.17173207.202462500TC(Inventory models for independent demand, moderate) {AACSB: Analytic Skills}
333 133.Holstein Computing manufactures an inexpensive audio card (Audio Max) for assembly into several models of its microcomputers. The annual demand for this part is 100,000 units. The annual inventory carrying cost is \$5 per unit and the cost of preparing an order and making production setup for the order is \$750. The company operates 250 days per year. The machine used to manufacture this part has a production rate of 2000 units per day.
• • • 