Given the above information what would be the economic


Antonio White's machine shop uses 3,500 brackets during the course of a year. These brackets are purchased from a supplier 80 miles away. The following information is known about the brackets:

Annual demand:

3,500

Holding cost per bracket per year:

$1.45

Order cost per order:

$15.50

Lead time:

2 days

Working days per year

260

  • Given the above information, what would be the economic order quantity (EOQ)?
  • Given the EOQ, what would be the average inventory? What would be the annual inventory holding cost?
  • Given the EOQ, how many orders would be made each year? What would be the annual order cost?
  • Given the EOQ, what is the total annual cost of managing the inventory?
  • What is the time between orders?
  • What is the reorder point (ROP)?

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Operation Management: Given the above information what would be the economic
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