Problemit is your responsibility as the new head of the, Ask an Expert

Management Studies

Problem:

It is your responsibility, as the new head of the automotive section of Nichols Department Store, to ensure that reorder quantities for the various items have been correctly established. You decide to test one item and choose Michelin tires, XW size 185 × 14 BSW. A perpetual inventory system has been used, so you examine this as well as other records and come up with the following data:


Cost per tire	$55	each
Holding cost	30	percent of tire cost per year
Demand	1,080	per year
Ordering cost	$24	per order
Standard deviation of daily demand	5	tires
Delivery lead time	6	days

Because customers generally do not wait for tires but go elsewhere, you decide on a service probability of 95 percent. Assume the demand occurs 365 days per year.

Required:

Question 1) Determine the order quantity.

Question 2) Determine the reorder point.

Solve the given numerical problem and illustrate step by step calculation.

View complete question

Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91162617

Have any Question?Write your Review or question?

Related Questions in Operation Management

1 given the following limitations of observational studies

1. Given the following limitations of observational studies, why are they still used in business research? 2. Describe the concept of convergence and how it relates to technology and e-commerce. 3. What are the major way ...

Regression and correlationmultiple regression analysis is

Regression and Correlation Multiple regression analysis is widely used in business research in order to forecast and predict purposes. It is also used to determine what independent variables have an influence on dependen ...

In addition to key executives there are other positions in

In addition to key executives, there are other positions in a company that may be considered critical, or whose loss will be difficult for the company. What will happen if a network administrator leaves? What customers o ...

1 interview people involved in exporting such as members of

1. Interview people involved in exporting such as members of a bank’s international department, foreign freight forwarders, export departments of a local multinational, the foreign trade specialists in the Department of ...

1 what three functions are necessary in order to produce a

1. What three functions are necessary in order to produce a product or deliver a service? a. IT, Finance and Sales b. Operations, Finance and IT c. Marketing, Operations and Finance d. Strategic planning, Marketing and S ...

1 are usually spreadsheets that are communicated to

1)________ are usually spreadsheets that are communicated to management on a regular basis–weekly, monthly, quarterly, and annually A) Balanced scorecards B) Process decision program charts C) Spider charts D) Matrix dia ...

This assignment asks you to persuade your audience to

This assignment asks you to persuade your audience to invest in a company related to a new growth industry. SITUATION You are an analyst for Cutting Edge Capital, a small venture capitalist company that seeks out the bes ...

Customer-based brand equity occurs when consumer response

Customer-based brand equity occurs when consumer response to marketing activity differs, when consumers know the brand, and when they do not. A number of benefits can result from a strong brand, both in terms of greater ...

1 what are three areas you would improve before performing

1. What are three areas you would improve before performing service-learning in the community? Please do not use interpersonal skills, problem solving skills and team leading skills. Describe steps you would take to impr ...

Topiconce you have selected one of following

Topic: Once you have selected one of following companies(computershare, virgin Australia, billabong, foster's group, bluescope), you are required to undertake and produce a strategic report that addresses the following t ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Operation Management Expert