Sturdivant Sound Systems

Case: Sturdivant Sound Systems (1) The best roll quantity is (see collect P12-Sturdivant, sheet #1) is 183 unit of measurements. (2). The re monastic evidence arcdegree is (20)(10) = 200 units, subject matter they atomic amount 18 actually ordering star cycle in appear when there argon 17 units in hand. (3) Total one-year price low express system with an order take aim of 400 units is (see commit P12-Sturdivant, sheet #2): Cost of equipment = (5,000 units)($60) = $300,000 Procurement greet = ($20 per order)(12.5 orders) = 250 Carrying greets = [(400/2) units]($6/unit) = 1,200 Total = $301,450 Total yearly constitute per optimal procurance policy is = (5,000)(60) + (5,000/183)(20) + (0.5)(183)(6) = $301,095.45. Cost nest egg = $301,450 - $301,095.45 = $354.55. (4) The typical be associated with procurement of materials include monetary values of preparing requisitions, composition purchase orders, receiving merchandise, inspecting goods, st orage, modify inventory records, and so on. These costs are usually fixed, irrespective of the size of the order. While a intumescent order may withdraw more time, the increase in procurement costs is minimal. As push-down list size increases, the number of orders decreases (assuming a constant unavoidableness level). Consequently, procurement costs result decrease with increases in lot sizes. | Sturdivant Sound Systems | 1.Compute the optimal order quantity.

First, tally the cost under the present policy: Number of orders/year orders Average order size or 385 units Total cost = order cost + holding cost + purchase cost | Purchase cost: 5000 units 60/unit| =| 300,000| | Order cost: $20/order 13 ord! ers| =| 260| | Carrying cost: | =| 1154| | Total cost | | $301,414| Next, develop an frugal Order Quantity, and determine the total costs: or 183 units where: D = period demand, S = setup or order cost, H = holding cost 2.Determine the appropriate reorder point (in units). reorder point = demand during lead...If you want to get a large essay, order it on our website: OrderEssay.net

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