Scribd Logo
Upload

Welcome to Scribd!

  • Group Work - Fah 07202

    Uploaded by

    Octavius Muyungi
    4 views1 page
    XYZ Ltd manufactures car tire tubes. They order tubes in batches with a Tzs 10,000 ordering cost per batch and carry inventory with a 20% annual cost. Tubes cost Tzs 50,000 each. Normal weekly tube usage is 15,000 tubes but ranges from 5,000 to 20,000 tubes. It takes 6-8 weeks for orders to be delivered. The company needs to calculate the economic order quantity, reorder level, maximum stock level, and minimum stock level.

    Original Description:

    Original Title

    Group Work- Fah 07202

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    XYZ Ltd manufactures car tire tubes. They order tubes in batches with a Tzs 10,000 ordering cost per batch and carry inventory with a 20% annual cost. Tubes cost Tzs 50,000 each. Normal weekly tube usage is 15,000 tubes but ranges from 5,000 to 20,000 tubes. It takes 6-8 weeks for orders to be delivered. The company needs to calculate the economic order quantity, reorder level, maximum stock level, and minimum stock level.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    4 views1 page

    Group Work - Fah 07202

    Uploaded by

    Octavius Muyungi
    XYZ Ltd manufactures car tire tubes. They order tubes in batches with a Tzs 10,000 ordering cost per batch and carry inventory with a 20% annual cost. Tubes cost Tzs 50,000 each. Normal weekly tube usage is 15,000 tubes but ranges from 5,000 to 20,000 tubes. It takes 6-8 weeks for orders to be delivered. The company needs to calculate the economic order quantity, reorder level, maximum stock level, and minimum stock level.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    Group work

    XYZ Ltd. are the manufactures of tyre tubes for cars. The following are the details
    of their operations during the current financial year:

    Ordering cost (per order) Tzs 10000


    Inventory carrying cost (per annum) 20%
    Cost of tubes (per tube) Tzs 50000
    Normal usage ( Tubes per week) Tzs 15000
    Minimum usage (tubes per week) Tzs 5000
    Maximum usage (tubes per week) Tzs 20000
    Lead time to supply (weeks) 6-8

    You are required to calculate:


    (i) Economic order quantity. If the supplier is willing to supply quarterly 1,500
    units at a discount of 5
    per cent, is it worth accepting?
    (ii) Re-order level
    (iii) Maximum level of stock
    (iv) Minimum level of stock

    You might also like