The Friendly Sausage Factory (FSF) can produce hot dogs at a rate of 5,000 per day. FSF supplies hot dogs to local restaurants at a steady rate of 250 per day. The cost to prepare the equipment for producing hot dogs is $66. Annual holding costs are 45 cents per hot dog.
The factory operates 290 days a year.
a. Find the optimal run size. (Do not round intermediate calculations. Round your answer to the nearest whole number.)
Optimal run size 1
b. Find the number of runs per year. (Round your answer to the nearest whole number.)
Number of runs 1
c. Find the length (in days) of a run. (Round your answer to the nearest whole number.)
A mail-order house uses 16,150 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies.
Number of Boxes Price per Box
1,000 to 1,999 $1.25
2,000 to 4,999 1.20
5,000 to 9,999 1.15
10,000 or more 1.10
a. Determine the optimal order quantity. (Round your answer to the nearest whole number.)
b. Determine the number of orders per year. (Round your answer to 2 decimal places.)
A newspaper publisher uses roughly 850 feet of baling wire each day to secure bundles of newspapers while they are being distributed to carriers. The paper is published Monday through Saturday.
Lead time is six workdays. What is the appropriate reorder point quantity, given that the company desires a service level of 95 percent, if that stockout risk for various levels of safety stock is as follows: 1,500 feet, .10; 2,000 feet, .05; 2,100 feet, .02; and 2,400 feet, .01?
A drugstore uses fixed-order cycles for many of the items it stocks. The manager wants a service level of .98. The order interval is 13 days, and lead time is 2 days.
Average demand for one item is 62 units per day, and the standard deviation of demand is 4 units per day. Given the on-hand inventory at the reorder time for each order cycle shown in the following table.
Use Table.
Cycle On Hand
1 39
2 6
3 100
Determine the order quantities for cycles 1, 2, and 3: (Round your answers to the nearest whole number)
Cycle
1
2
3