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Manfred Manufacturing Is Involved in the Production of Machine Parts

question 33

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Manfred Manufacturing is involved in the production of machine parts.The company uses 600,000 pounds of steel annually.The current purchasing cost for steel is $3.20 per pound.The carrying cost for inventory is 10 percent of the purchase price.The cost of ordering steel is $800 per order.The company has decided to maintain a safety stock of 15,000 pounds.The delivery time per order is 6 days.The company works 365 days a year. a.Determine the optimal EOQ. b.How many orders will be placed annually? c.What is the average inventory? d.What is the inventory order point? (That is,at what level of inventory should a new order be placed?) e.What is the company's total inventory costs for the year?


Definitions:

Neutral pH

A pH value of 7, indicating a balance between acidity and alkalinity in a solution, considered neither acidic nor basic.

Covalent Bonds

Chemical bonds formed by the sharing of one or more pairs of electrons between atoms to achieve a more stable electron configuration.

Organic Molecule

Molecule that always contains carbon and hydrogen, and often contains oxygen as well; organic molecules are associated

Carbon Atom

A chemical element with symbol C and atomic number 6, fundamental to all known life, able to form stable bonds with many elements including itself.

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