For Supply Item ABC,Andrews Company Has Been Ordering 125 Units

question 117

Essay

For supply item ABC,Andrews Company has been ordering 125 units based on the recommendation of the salesperson who calls on the company monthly.A new purchasing agent has been hired by the company who wants to start using the economic-order-quantity method and its supporting decision elements.She has gathered the following information:
$$\begin{array} { | l | r | } \hline \text { Annual demand in units } & 250 \\\hline \text { Days used per year } & 250 \\\hline \text { Lead time, in days } & 10 \\\hline \text { Ordering costs } & \$ 100 \\\hline \text { Annual unit carrying costs } & \$ 20 \\\hline\end{array}$$ Required:
Determine the EOQ,average inventory,orders per year,average daily demand,reorder point,annual ordering costs,and annual carrying costs.

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Definitions:

Multisource Input

A method of gathering feedback or input from multiple sources, often used in performance appraisal to get a comprehensive view of an employee's performance.

Encouragement

The act of giving support, confidence, or hope to someone, often used in a work context to inspire or motivate employees.

Goal Setting

The process of establishing specific, measurable, achievable, relevant, and time-bound objectives that guide individuals or organizations.

Forced Ranking System

A controversial performance management system where employees are ranked against each other in categories, often leading to a certain percentage being identified as top performers, while others are deemed low performers.