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Given the following inventory information: Demand 10+ n units per day Purchase cost = $15 per unit Ordering cost = $200 + $n per order Holding cost = $0.12 per unit per day Lead time 4 days Number of working days in a year 250 days mpe:55 245 p Demand = 10 + n = 10 + 45 = 55 units per day Ordering cost = $200 + $n = $200 + $45 = $245 per order Use your n (the summation of all digits of your ID number) to answer the following questions: Round your non-integer answers to four decimal places. Given the order quantity of 600 units, what is the total daily inventory cost, including the item’s purchase cost? A. B. What is the EOQ? C. At EOQ, what is the total annual inventory cost, including the item’s purchase cost? What is the reorder point? At EOQ, what is the length of order cycle ? D. E. https://d2vlcm61l7u1fs.cloudfront.net/media%2F6b8%2F6b8e37ee-e97c-4a10-a8fa-ac1cf0d6b604%2FphpE53cxC.png

If n=48
Average daily demand(d) = 10+n units = 10+48 = 58 units
Number of days in a year = 250 days
Annual demand (D) = 58 units x 250 = 14500 units
Ordering cost (S) = $200+$n = $200+$48 = $248 per order
Holding cost (H) = $0.12 per unit per day
Purchase cost (p) = $15 per unit
Lead time (L) = 4 days
A) If the order quantity (Q) = 600,
Total annual inventory cost = Ordering cost + Holding cost + purchase cost
= [(D/Q) S] + [(Q /2)H] + (pxD)
= [(14500/600)248] + [(600/2)0.12] + (15 x 14500)
= $5993.3333 + $36 + $217500
= $223529.3333
Total daily inventory cost = Total annual inventory cost / number of days in a year
= $223529.3333/250 days
= $894.1173 per day
B) Economic order quantity (Q*) = sqrt of (2DS /H)
= sqrt of [(2 x 14500 x 248) / 0.12]
= 7741.6622 or rounded to 7742 units
C) With economic order quantity (Q*) = 7742 units,
Total annual inventory cost = Ordering cost + Holding cost + purchase cost
= [(D /Q*) S] + [(Q*/2)H] + (pxD)
= [(14500/7742)248] + [(7742/2)0.12] + (15×14500)
= $464.4795 + $464.52 + $217500
= $218428. 9995
D) Reorder point = d x L = 58 x 4 = 232 units
E) length of order cycle = (Q*/D) number of days per year
= (7742/14500)250
= 133.4828 or rounded to 133 days
 
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