Answer to Question #282045 in Other for Sahba

Question

Order cost is 31$ for material that costs 12.5$per pound. The annual holding costrate is estimated at 18 percent of material cost, and monthly requirements are fairly stable at 15000 pounds Backorders should not be considered as shortage costs are very high. Orders must be in whole pounds.

A) How many pounds should be ordered at a time

B)what is the average number of orders per year and what is the average number of days between orders

C) what is the average annual ordering cost what is the average annual holding cost (given your recommendation)?

D) suppose you currently order material once per month. Determine the annual saving under your plan

E)suppose that you have bad information on order cost and that the true order cost is 15.5$.what is the percentage cost Permian associated with pursuing your original recommendation instead of the true best policy?

Answer 1

Dear Sahba, your question requires a lot of work, which neither of our experts is ready to perform for free. We advise you to convert it to a fully qualified order and we will try to help you. Please click the link below to proceed: Submit order