Assignment:
Calculate the economic order quantity, the safety stock, and the average inventory necessary to achieve a 98 percent customers service level given the following information.
a) the average daily demand for a 25-day period was found to be
|
Day
|
Unit Demand
|
|
1
|
8
|
|
2
|
5
|
|
3
|
4
|
|
4
|
6
|
|
5
|
9
|
|
6
|
8
|
|
7
|
9
|
|
8
|
10
|
|
9
|
7
|
|
10
|
6
|
|
11
|
7
|
|
12
|
8
|
|
13
|
12
|
|
14
|
9
|
|
15
|
10
|
|
16
|
5
|
|
17
|
8
|
|
18
|
11
|
|
19
|
9
|
|
20
|
7
|
|
21
|
7
|
|
22
|
6
|
|
23
|
8
|
|
24
|
10
|
|
25
|
11
|
b)there is not variable in order cycle
c)The order cost is $20 per order
d)The annual demand is 2000
e)The cost is $100 per unit
f)The inventory carrying cost is 35%
g)The products are purchased FOB destination
Provide complete and step by step solution for the question and show calculations and use formulas.