Muscat Tubes Manufacturing LLC are the manufacturer of picture tubes for T.V. The following are the details of their operation during 2019. Rate of consumption per week is 200 units for Muscat Tubes Manufacturing LLC. Company estimated inventory carrying cost at 20% per annum. The ordering cost per order is RO 100. The cost incurred for purchasing a tube is RO 500. The rate of consumption per week is 100 to 300 units and lead time to supply is 6 to 8 weeks. During emergency purchase the lead time is 2 weeks. Calculate the following: a. Reorder level b. Maximum level of stock c. Minimum level of stock d. Average level of stock e. Danger Level

Muscat Tubes Manufacturing LLC are the manufacturer of picture tubes for T.V. The following are the details of their operation during 2019. Rate of consumption per week is 200 units for Muscat Tubes Manufacturing LLC. Company estimated inventory carrying cost at 20% per annum. The ordering cost per order is RO 100. The cost incurred for purchasing a tube is RO 500. The rate of consumption per week is 100 to 300 units and lead time to supply is 6 to 8 weeks. During emergency purchase the lead time is 2 weeks. Calculate the following: a. Reorder level b. Maximum level of stock c. Minimum level of stock d. Average level of stock e. Danger Level

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

ChapterC: Cases

Section: Chapter Questions

Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. Is Ben Gibson acting legally? Is he acting ethically? Why or why not?
The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.
Barangay Punta Princesa is trying to decide between two alternative order plans for its inventory of face masks. Irrespective of the plan to be followed, demand for the item is expected to be 1,000 units annually. Under Plan A, Barangay Punta Princesa through their purchasing officer is using a digital platform for ordering: order costs would be Php 40 per order. Inventory holding costs (carrying costs) would be Php 100 per unit per annum. Under Plan B order costs would be Php 30 per order. And holding costs would 20% and unit cost is Php 480. Find out EOQ and Total Inventory cost, then come up with your decision which plan would result in the lowest total inventory cost?
Barangay Punta Princesa is trying to decide between two alternative order plans for its inventory of face masks. Irrespective of the plan to be followed, demand for the item is expected to be 1,000 units annually. Under Plan A, Barangay Punta Princesa through their purchasing officer is using a digital platform for ordering: order costs would be Php 40 per order. Inventory holding costs (carrying costs) would be Php 100 per unit per annum. Under Plan B order costs would be Php 30 per order. And holding costs would 20% and unit cost is Php 480. Find out EOQ and Total Inventory cost, then come up with your decision which plan would result in the lowest total inventory cost? can you answer this asap?
“The ABC Supply company is currently experiencing with an inventory rotation problem. This difficulty stems from the fact that some supplies must be used prior to a stated expiration date. Upon receipt, a new shipment of these perishable items must be stacked beneath the boxes that are currently in inventory. A substantial amount of time is consumed in restacking the items according to their expiration dates.” Required: Explain the DMAIC methodology that can be used by the “ABC” company to implement Six Sigma Process for the above scenario. 800 words
Over the past 5 weeks, demand for wine at Winston's Winery has averaged 1,940 bottles, and the variance of demand has been 874,250 bottles. Winston has ordered an average of 1,940 bottles per week over that time period, with a variance of orders of 1,941,750 bottles. a) The bullwhip measure for glass bottles for Winston's Winery is ___ b) Winston winery is providing _____ in its supply chain. -an amplification effect -a smoothing effect
Use the information below to answer the following question(s). Office Supply House purchases 4,160 reams of paper per year, ordered in lots of 80 reams per week at $150 per ream. The vendor covers all shipping costs. Office Supply House is not required to inspect the shipment upon entry. Office Supply House earns 20% on its cash investments. The purchase order lead time is two weeks. The following cost data are available: Relevant ordering costs per purchase order $53.75 Relevant insurance, materials handling, breakage, and so on, per year $4.25 How many deliveries will be required at the economic order quantity level? 42 deliveries 18 deliveries 52 deliveries 20 deliveries 37 deliveries
Last year, the retailer’s weekly variance of demand was 200 units. The variance of orders was 500, 600, 750, and 1,350 units for the retailer, wholesaler, distributor, and manufacturer, respectively.a) Calculate the bullwhip measure for the retailer.b) Calculate the bullwhip measure for the wholesaler.c) Calculate the bullwhip measure for the distributor.d) Calculate the bullwhip measure for the manufacturer.e) Which firm appears to be contributing the most to the bull-whip effect in this supplychain?
Discount-Mart (see Problem 16.8), as part of its newLean program, has signed a long-term contract with SpecialtyLighting and will place orders electronically for its halogen lamps.Ordering costs will drop to $.50 per order, but Discount-Mart alsoreassessed its carrying costs and raised them to $20 per lamp.a) What is the new economic order quantity?b) How many orders will now be placed?c) What is the total annual cost of managing the inventory withthis policy?
Qatar Airways has implemented a new online purchasing (ordering) system, as a result the order cost reduced by half, therefore, the economic order quantity (EOQ) will decrease by
Black Instrument Company replenishes highly specialized replacement (service) parts based on statistical reorder point. One part is a 40-mm thumbscrew. Relevant data for the thumbscrew are: Planned stock out frequency= Six per year. Planned lead time = 2 weeks Forecast for next week= 300 Batch size = 400 Standard deviation of demand = 20 (per week) What is the reorder point? What would be the effect on the ROP if lead time were five weeks instead of two? What other factors might impact your decision on when to reorder parts?
Catlea Merchandising is engaged in selling school shoesfor both boys and girls in their teenage years. Catlea needs 32,000 pairs of shoes in a year in order to satisfy the market demand. It costs ₱ 48 to place an order while ₱ 8 is needed to hold each quantity of shoe in Catlea's inventory. Upon checking on Catlea's supplier, it takes 8 days in between placing an order and eventually receiving it. a. Determine the Economic Order Quantityb. Determine the number of order per monthc. Determine the reorder point