Demand for the BMX Bike at Toby’s is 600 units per month. Toby’s incurs a fixed order placement, transportation, and receiving cost of $ 3,500 each time an order is placed. Each Bike costs $ 450 and the retailer has a holding cost of 20 percent. Evaluate the number of Bikes that the store manager should order in each replenishment lot. How many orders per period (Year) will have to be made (N) (under EOQ)?

Demand for the BMX Bike at Toby’s is 600 units per month. Toby’s incurs a fixed order placement, transportation, and receiving cost of $ 3,500 each time an order is placed. Each Bike costs $ 450 and the retailer has a holding cost of 20 percent. Evaluate the number of Bikes that the store manager should order in each replenishment lot. How many orders per period (Year) will have to be made (N) (under EOQ)?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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