M/S Tubes Ltd is the manufactures of picture tubes for T.V. The following are the details of their operations:
|
Average monthly market demand: |
2,000 tubes |
|
Ordering cost |
Rs. 100 per order |
|
Inventory–carrying cost |
20% p.a. |
|
Cost of tubes |
Rs. 500 per tube |
|
Normal usage |
100 tubes per week |
|
Maximum usage |
200 tubes per week |
|
Minimum usage |
50 tubes per week |
|
Lead time to supply |
6 to 8 weeks |
Compute from the above
- EOQ. If the supplier is willing to supply quarterly 1,500 units at a discount of 5% is it worth accepting?
- Maximum level of stock
- Minimum level of stock
- Reorder level