A production company A, made JITD strategic alliance with a distribution company B. The content of alliance is,
Company A executes work for company B's inventory management and all the inventory cost caused from B is responsible on A.
The decision for inventory replenishment is made on every Saturday,
Order amount is arrived every Sunday night after the delivery process from A to B.
The amount of starting inventory is 50 at Week 0
Inventory holding cost: 1,000 won/week per unit
When the shortage incurred, it is taken care of as Backorder, not as lost-sale. Backorder cost : 2,000 won/week per unit.
Inventory replenishment happens when the inventory level is less than 19, and the amount of inventory to be refilled is calculated as "50-current inventory level".
Transportation cost: 50,000 won per every delivery
If the total number of demand met - the total number of Backorder is more than 131, the incentive, 20,000 won per unit is given to A.
Following table shows weekly demand of 'B' company for last 8 weeks. Please answer based on the information given above. All the cost is calculated from week 1.
|
Week
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0
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1
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2
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3
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4
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5
|
6
|
7
|
8
|
Total
|
|
Weekly demand
|
|
15
|
20
|
10
|
15
|
30
|
20
|
5
|
35
|
150
|
|
Demand met
|
|
|
|
|
|
|
|
|
|
|
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Inventory level
at the end of Week
|
50
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|
|
|
|
|
|
|
|
|
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Holding cost
|
|
|
|
|
|
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Shortage cost
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|
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Amount of Inventory to be replenished
|
|
|
|
|
|
|
|
|
|
|
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Transportation cost
|
|
|
|
|
|
|
|
|
|
|
(1) How much inventory does company A replenish for the first time?
(2) How many times does company A replenish inventory for 8 weeks?
(3) How many times does company B experience inventory shortage for 8 weeks?
(4) How many demands of company B were met for 8 weeks among 150?
(5) How much does company A have to pay for total shortage cost for 8 weeks?
(6) Company A would experience (More profit or Loss of profit), and the amount would be _______________ won. [Note: Total expense company A = holding cost+ shortage cost+ transportation cost. If the total expense is lower than the total incentive company A would receive, we consider "More profit". Otherwise we consider it as "Loss of profit"]