In your studies this week, you found that the optimal order quantity is achieved at the point at which inventory setup cost per unit of time equals inventory holding cost per unit of time. Knowing this, your employer, a manufacturer of office chairs, asks that you determine the optimal order quantity for two suppliers of coil springs.
Your manufacturing facility operates 50 weeks a year and requires a steady supply of 1000 coil springs per week. Supplier A charges $1 for each spring, and you resell them for $4 each. The set up charge is $20 per order. An inventory carrying charge of 25% is incurred.
Complete the table and calculate the optimal order quantity for Supplier A.
Inventory carrying cost
Show equation used with all above values filled in
Optimal order quantity of springs
Provide a similar table and calculate the optimal order quantity of springs for Supplier B. Supplier B charges $2 for each spring. The set up charge is $10 per order. All other variables remain the same as with Supplier A.
The calculations assume that you are starting with a zero inventory balance. Discuss why zero inventory balance is or is not a desirable condition in most businesses. Be sure to include at least the three benefits of lower inventory carrying costs, having an inventory safety stock, and other potential benefits or risks.
The Optimal Order Quantities paper:
Must be two to three double-spaced pages in length (not including title and references pages) and formatted according to APA style
Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount! Use Discount Code “Newclient” for a 15% Discount!
NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.
The post Optimal Order Quantities business and finance homework help appeared first on Nursing Writers Hub.
"Is this question part of your assignment? We Can Help!"