Question

In: Statistics and Probability

Bart's Barometer Business is a retail outlet that deals exclusively with weather equipment. Bart is trying...

Bart's Barometer Business is a retail outlet that deals exclusively with weather equipment. Bart is trying to decide on an inventory and reorder policy for home barometers. Barometers cost Bart $140 each and demand is about 5,900 per year distributed fairly evenly throughout the year. Reordering costs are $120 per order and holding costs are figured at 15% of the cost of the item. BBB is open 365 days a year. Lead time is 11 working days.

Questions:

EOQ =

Re-order Point =

Use Excel and show formulas used

Solutions

Expert Solution

Answer:

By using given data,

Please find attached the required solutions in Excel:

1)

2)

(A) Economic order quantity (EOQ) = 206.79 or 207 units

3)

4)

(B) Re-order point = 272.22 or 272 units

orchestra answered 1 year ago
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