Assume that ABC company is decided to sale every tire at $ 2 per unit. Forecasted demand of tire in next year is 9,600. Annual carrying cost is $16 per tire and ordering cost is $ 75. The distributor operates 288 days a year. i. What is the EOQ? ii. Hw many times per year does the store reorder? iii. What is the length of an order cycle? iv. What is the total annual cost if the EOQ quantity is ordered?

Assume that ABC company is decided to sale every tire at $ 2 per unit. Forecasted demand of tire in next year is 9,600. Annual carrying cost is $16 per tire and ordering cost is $ 75. The distributor operates 288 days a year. i. What is the EOQ? ii. Hw many times per year does the store reorder? iii. What is the length of an order cycle? iv. What is the total annual cost if the EOQ quantity is ordered?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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