Q Problem 1 a. Determine an A-B-C classification for these items: b. Find the EOQ given this information: D = 4,500 units/year, S = $36, and H = $10 per unit per year. c. Find the economic production quantity given this information. Problem 3 A bakery buys flour in 25-pound bags. The bakery uses 1,215 bags a year. Ordering cost is $10 per order. Annual carrying cost is $75 per bag. a. Determine the economic order quantity. b. What is the average number of bags on hand? c. How many orders per year will there be? d. Compute the total cost of ordering and carrying flour. e. If holding costs were to increase by $9 per year, how much would that affect the minimum total annual cost? Problem 10 A chemical firm produces sodium bisulfate in 100-pound bags. Demand for this product is 20 tons per day. The capacity for producing the product is 50 tons per day. Setup costs $100, and storage and handling costs are $5 per ton a year. The firm operates 200 days a year. (Note: 1 ton = 2,000 pounds.) a. How many bags per run are optimal? b. What would the average inventory be for this lot size? c. Determine the approximate length of a production run, in days. d. About how many runs per year would there be? e. How much could the company save annually if the setup cost could be reduced to $25 per run? Problem 33 Given the following list of items, a. Classify the items as A, B, or C. b. Determine the economic order quantity for each item (round to the nearest whole unit). Item Estimated Annual Demand Ordering Cost Holding Cost (%) Unit Price H4-010 20,000 50 20 2.50 H5-201 60,200 60 20 4.00 P6-400 9,800 80 30 28.50 P6-401 14,500 50 30 12.00 P7-100 6,250 50 30 9.00 P9-103 7,500 50 40 22.00 TS-300 21,000 40 25 45.00 TS-400 45,000 40 25 40.00 TS-041 800 40 25 20.00 V1-001 33,100 25 35 4.00

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