Posted: April 21st, 2018

BUSN – A firm is faced with the attractive situation in which it can obtain

A agency is confronted with the engaging scenario during which it might get hold of instant supply ofan merchandise it shares for retail sale. The agency has due to this fact not bothered to order the merchandise inany systematic approach. Nevertheless, just lately income have been squeezed because of increasingcompetitive pressures, and the agency has retained a administration marketing consultant to review itsinventory administration. The marketing consultant has decided that the assorted costsassociated with making an order for the merchandise stocked are roughly $70 per order.She has additionally decided that the prices of carrying the merchandise in stock quantity toapproximately $27 per unit per 12 months (primarily direct storage prices and forgone revenue oninvestment in stock). Demand for the merchandise in all fairness fixed over time, and theforecast is for 16,500 items per 12 months. When an order is positioned for the merchandise, the entireorder is straight away delivered to the agency by the provider. The agency operates 6 days aweek plus a number of Sundays, or roughly 320 days per 12 months. Decide the next:a. Optimum order amount per orderb. Whole annual stock costsc. Optimum variety of orders to put per yeard. Variety of working days between orders, based mostly on the optimum ordering.

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