Time units: days
Demand units: tins
Time between periodic review of inventory: 10 days
Order lead time: 3 days
a. 113 tins
b. If standard deviation drops to 4 tins, the restocking level drops to 97 tins. Lower variability results in a lower level of safety stock
c. See graph
Time Inventory Level
0113
10 0
10 113
20 0
20 113
30 0
100
120
Cycle Stock at Jimmy’s Delicatessen
a.)
Time units: days
Demand units: meals
Time between periodic review of inventory: 5 days
Average order lead time: 2 days
Average demand during reorder period and order lead time: 100 meals
Percent desired service level: 95%
z value (for desired service level): 1.65
b.)
Restocking level: 126
Annual demand: 16000
Annual demand: 32000
Annual demand: 16000
Annual holding cost, per unit: $2.50
Discount annual ordering cost: $533.33
Total cost: $722,408.33
Economic order quantity: 800
Total cost of units: $800,000.00
Annual demand: 1200
Annual demand: 1200
Annual holding cost, per unit: $15.00
Cost per order: $200.00
Discount order quantity: 201
Discounted total cost of units: $50,400.00
Economic order quantity: 179
Total cost of units: $60,000.00
Time units: weeks
Demand units: workbenches
Average order lead time: 3 weeks
Standard deviation of lead time: 1.2 weeks
Time units: weeks
Demand units: workbenches
Average order lead time: 3 weeks
Standard deviation of lead time: 0 weeks
Annual demand: 4000
Annual demand: 4000
Total cost: $500.00
Time units: weeks
Demand units: bags
z value (for desired service level): 1.65
Reorder point: 198 bags
Time units: weeks
Demand units: bags
Time between periodic review of inventory: 1 weeks
Average demand during reorder period and order lead time: 240 bags
Standard deviation of demand during reorder period and order lead time: 28 bags
Note: The answer assumes that the replenishment lead time is still 2 weeks. IF the