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ID: 377248 • Letter: O

Question

o YouTube Y. Unit 6: Learning activities X Y P Do Ilomework - Mark Ce XYC Operations Managemenl x yati - o x + C o a Secure | https://www.mathxl.com/Student/PlayerHomework.aspx?homeworkid=459272161&questionid;=6&flushed;=fal. & * 2 + 2 + B S A G O 3 Apps * Bookmarks e Man Utd Arsenal Live Apple Y Yahoo! A Guogle Maps o YouTube I News I imported from Salari I Popular D duner » I OLher bookmarks 17/FA. OPERATIONS MANAGEMENT Mark Carr & | 12/6/17 12:04 PM Save Homework: Unit 6 AS: Homework 6 Score: 0 of 3 pts Problem 13 7 of 8 (6 complete)Y Hw Score: 57.5%, 11.5 of 20 pts EQuestiori Help Sam's Cat Hotel operates 52 weeks per year. 5 days per week, and uses a continuous review inwentary system it purchases kitty Iitter for $12 on per bag The following information is available about these hags Refer to the standard normal table for 7-values > Demand = 95 bagsweek • Order Cost = $57/order > Annual holdrig cost = 28 percent of cost > Desired cycle service level = 98 percent > Lead time - 1 weeks) (20 working derys) - Standard deviention of weekly demand - 13 begs > Current on-hand inventory is 310 bags, with no apen orders or backorders. a. What is the E00? Sam's optimal order quantity is bags. Enter your response roved to the nearest Male Amber) Enter your answer in the answer box and then click Check Answer. ? : 9 parts 9 remaining Clcar All Check Answer 12:04 PM DO O Type here to search ! :D) 9 10 ou e N O P wa A A * 12/6/2017 Y

Explanation / Answer

Sam’s optimal order quantity EOQ = Square root ( 2 x Co x D/ Ch )

Where ,

D = Annual demand = 95 bags / week x 52 weeks = 4940 bags

Co = Ordering cost = $57 / order

Ch = Annual unit holding cost = 28% of $ 12 / bag= $ 3.36 / bag

EOQ = Square root ( 2 x 57 x 4940 / 3.36)

           = 409.39 ( 409 rounded to nearest whole number )

SAM’S OPTIMAL ORDER QUANTITY = 409 BAGS

SAM’S OPTIMAL ORDER QUANTITY = 409 BAGS