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##### 6-25 Ross White?s machine shop uses 2,500 brackets

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**Question**

6-25;Ross White?s machine shop uses 2,500 brackets during the course of a year, and this usage is relatively constant throughout the year. These brackets are purchased from a supplier 100 miles away for $15 each, and the lead-time is 2 days. The holding cost per bracket per year is $1.50 (or 10% of the unit cost) and the ordering cost per order is $18.75. There are 250 working days per year.;(a) What is the EOQ?;(b) Given the EOQ, what is the average inventory? What is the annual inventory holding cost?;(c) In minimizing cost, how many orders would be made each year? What would be the annual ordering cost?;(d) Given the EOQ, what is the total annual inventory cost (including purchase cost)?;(e) What is the time between orders?;(f) What is the ROP?

Paper#33424 | Written in 18-Jul-2015

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