# Inventory system continuous review

2. A manufacturer uses a continuous review inventory system. It purchases motorcycle part for ₹12 per part. The demand of the part is 80 units per week, and its weekly standard 2 of 3 deviation is 15. The company estimates ordering cost as ₹55/order, lead time as 3 weeks (18 working days) and annual holding cost as 30%. The company aims to provide 92% service level. The company operates 52 weeks per year, 6 days per week. Current on-hand inventory is 300 units, with no open orders or backorders.
(a) Determine EOQ and average time between orders (in weeks)

(b) What is total cost for the EOQ?

Don't use plagiarized sources. Get Your Custom Essay on
Inventory system continuous review
Just from \$13/Page

(c) What should reorder point be?

(d) If an inventory withdrawal of 40 units was just made, is it time to reorder?

(e) Instead of using EOQ, the company is currently using a lot size of 550 units. What is the annual holding cost and annual ordering cost? Without determining EOQ and its corresponding cost, from these two costs how can you conclude that current lot size is too large?

(f) Using the Internet the company automated order placing which reduced the ordering cost to ₹15. However, operations manager responsible for inventory management was unaware of the development, and therefore EOQ was not adjusted to account new reduced ordering cost. If actual demand is 60 units, how much higher total cost the company will be paying, compared to the total cost if they could adjust the EOQ?

Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with CheggAnswers

Quality Essays

At CheggAnswers.com, we boast of our quick turnaround that is facilitated by our experienced team of writers. We can handle both short and long deadlines, as per our clients’ requests. Quality work is the cornerstone of our service.

Top Writers

Our writers are qualified professionals who are well-versed with more than 80 subjects. We have achieved this milestone overtime because of our rigorous hiring process that filters professionals from average writers. We believe that exposing our customers to qualified writers is the starting point of delivering quality work.

Plagiarism-Free Papers

Our writers submit papers that are written from scratch to uphold the much-needed originality when submitting your papers. Our references are mainly sourced from reputable databases such as Emerald Insight, Ebsco, and ProQuest. All papers follow the conventional styles of referencing that include APA, MLA, Chicago, Harvard, and Vancouver.

The customer is king and as such, CheggAnswers.com has a committed support department that handles all concerns and clarifications from our clients. We encourage customers to contact us at any given time through our listed telephone, email, and text platforms.

Prompt Delivery & 100% Money Back Guarantee

Your work starts immediately after placing an order. Our writers are aware of our company policy that guarantees quality work to all our customers. For this reason, CheggAnswers strives to deliver assignments on time to avoid any delays that might compromise our relationship with clients.

Free Revisions

Although we are confident in our writers, you are entitled to free revisions whenever need arises. However, we highly disregard customers who misuse this privilege.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Follow these simple steps to get your paper done

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

We offer a wide range of services that are aligned with the customers’ needs and expectations. We have positioned ourselves strategically to become a one-stop-shop where customers can access all academic services under one roof.

Our main service is academic paper writing, which is handled by a pool of experienced writers who uphold the expected standards of writing. Over the years, we have delivered quality work to our clients because of our commitment to promote quality over quantity.

Whether you are about to Join College or you are a continuing student, CheggAnswers is there to help. Our competent professionals will solve all your writing problems. Personalization is key to scoring highly and satisfying the admission board’s expectations. We will help you achieve your academic goals.

Some of our clients prefer to write their essays and have a third-party like CheggAnswers proofread their work. We have a skilled team of editors who comb through your paper and make any amends to increase its overall appeal. For all your editing and proofreading needs, CheggAnswers is there to help.

Revision Support

At CheggAnswers, we offer an extensive revision support that works tirelessly to ensure that customer needs and expectations are met. We work closely with writers upon a customer’s revision request to ensure that we keep our promise of delivering quality work to all our clients.