Question
In: Advanced Math
NEW NUMBERS Chris Froome is a purchasing agent for a firm that sell components for high...
NEW NUMBERS
Chris Froome is a purchasing agent for a firm that sell components for high performance bicycles. One of the most popular components is the TDF bicycle frame which has an annual demand of 1,750 units. The cost of each frame is $675 and the inventory carrying cost is estimated to be 18% of the cost of each frame. Chris has made a study of the costs involved in placing an order for any of the frames the firm stocks, and he has concluded that the average ordering cost of $73 per order. Furthermore, it takes about one week for an order to arrive from the supplier, and the TDF operates 50 weeks per year.
a) What is the annual ordering cost?
b) What is the annual holding cost?
c) How many orders (on average) would be placed per year?
d) What is the average inventory?
e) What is the reorder point?
f) What is the EOQ?
Solutions
Colby Messinger answered 2 years agoRelated Solutions
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Required
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Controls can be implemented to prevent or detect the
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collected the following information for its income statement and
cash flow statement. However, this income statement was calculated
as if there is no inflation! All dollars are expressed in constant
(year-0) dollars. Recalculate the income and cash flow statement by
assuming there is a general (average) inflation of 2.6% applied to
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assuming there is a general (average) inflation of 2.6% applied to
revenue, O&M, and salvage value.
- The firm will pay back the loan in 2 years, and the...
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