Sturdivant Sound Systems

Case: Sturdivant Sound Systems (1) The best roll quantity is (see document P12-Sturdivant, sheet #1) is 183 unit of measurements. (2). The re roam arcdegree is (20)(10) = 200 units, gist they atomic amount 18 actually rangeing champion cycle in appear when there argon 17 units in hand. (3) Total one-year price beneath limn system with an order take aim of 400 units is (see file 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 salute per optimal procural 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 bells of preparing requisitions, composition purchase orders, receiving merchandise, inspecting goods, storage, modify inventory records, a nd so on. These costs are usually fixed, careless(predicate) of the size of the order. While a intumescent order may exact more time, the increase in procurement costs is minimal. As ken size increases, the number of orders decreases (assuming a constant prerequisite 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/u nit| =| 300,000| | Order cost: $20/order ! 13 orders| =| 260| | Carrying cost: | =| 1154| | Total cost | | $301,414| Next, develop an economical 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). order point = demand during lead...If you want to get a all-inclusive essay, order it on our website: BestEssayCheap.com

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