Take Test: Assignment 2 Test Information DescriptionInstructionsTimed TestThis test has a time limit of 2 hours.This test will save and submit...

Take Test: Assignment 2 

DescriptionInstructionsTimed TestThis test has a time limit of 2 hours.This test will save and submit automatically when the time expires.

Warnings appear when half the time, 5 minutes, 1 minute, and 30 seconds remain.Multiple AttemptsThis test allows 3 attempts. This is attempt number 1.Force CompletionOnce started, this test must be completed in one sitting. Do not leave the test before clicking Save and Submit.

Remaining Time: 1 hour, 31 minutes, 54 seconds.

1. Amazon sells 8,000 Lenovo PCs every month. Each PC costs $500 and Amazon has a holding cost of 20 percent. For what fixed cost per order would an order size of 8,000 units be optimal?  

2 points  

1. A North Face retail store in Chicago sells 520 jackets each month. Each jacket costs the store $100 and the company has an annual holding cost of 25 percent. The fixed cost of a replenishment order (including transportation) is $100. The store currently places a replenishment order every month for 500 jackets.
2. For all questions that follow, round your answers to two (2) decimal places.
3. What is the annual holding cost?  
4. What is the annual ordering cost?  
5. If the retail store wants to minimize the annual total inventory cost, what order size do you recommend? 
6. How much would the optimal order quantity reduce the annual total inventory cost relative to the current policy? 

10 points  

1. Blue Mountain Bike, Inc. (BMBI) makes racing bicycles. It produces 500 bicycles a month. The company purchases the tires for bicycles from Tire4Less, Inc. (TLI). The cost of each tire is $25. BMBI's inventory carrying cost is estimated to be 20% of the cost of tire and the ordering cost is $48 per order.
2. For all questions that follow, round your answers to two (2) decimal places.
3. Calculate the EOQ for tires. 
4. Calculate the cycle inventory for tires. 

4 points  

1. An electronics company has two contract manufacturers in Asia: Foxconn assembles its tablets and Flextronics assembles its laptops. Monthly demand for tablets is 10,000 units, whereas that for laptops is 4,000. Tablets cost the company $100, laptops cost $400, and the company has a holding cost of 25 percent. Currently the company has to place separate orders with Foxconn and Flextronics and receives separate shipments. The fixed cost of each shipment is $10,000.
2. For all questions that follow, round your answers to two (2) decimal places.
3. What is the optimal order size with Foxconn? 
4. What is the optimal order size with Flextronics? 
5. What is the average flow time for tablets in days? 
6. What is the average flow time for laptops in weeks? 

8 points  

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