An electronics retailer carries a particular cellular telephone with the following characteristics:
Average monthly sales: 120 units
Ordering cost: $25 per order
Carrying rate: 0.35
Item cost: $300
Lead time: 4 days
Standard deviation of daily demand: 0.2 unit
Working days per year: 250
A) Determine the EOQ
B) Calculate the reorder point for a 0.92 service level, assuming normally distributed demand.
C) If the firm use Q system of inventory control, interpret the results of your computations.

Question

11-06-2024
Business

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An electronics retailer carries a particular cellular telephone with the following characteristics:
Average monthly sales: 120 units
Ordering cost: $25 per order
Carrying rate: 0.35
Item cost: $300
Lead time: 4 days
Standard deviation of daily demand: 0.2 unit
Working days per year: 250
A) Determine the EOQ
B) Calculate the reorder point for a 0.92 service level, assuming normally distributed demand.
C) If the firm use Q system of inventory control, interpret the results of your computations.

Sagot :

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