ramneek
MGMT 5006 Assignment 2
Beehive Truss and Roof Corporation
Submitted to: Neda Onaran Submitted by: Ramneek Singh Tuli Student Id: 4235122 Date: 22nd March 2015
Provide a descriptive quantitative analysis of possible order quantities. the Cost factors that we need to find those includes:
Inventory carrying cost
Order processing cost
Transport cost first of all the demand for possible units would be there are 80 units in a box and there are 24 boxes on one pallet the number of pallets are 4. so the possible quantity of order will be : 4 * 24 * 80 = 7680 units possible quantity. possible order quantity per year will be = there is 7680 units demand bi weekly and for a year it will be
52 weeks /2 =26 weeks
7680*26 = 199680 Units
INVENTORY CARRYING COST there are more noteworthy conveying expenses to consider. Stock conveying expenses are communicated as the result of estimation of the great; the conveying expense and the normal amount available good value per unit =
$120 /80 = $1.50 per unit carrying cost per unit=
20% of per unit = 1.50 * 20% = .3 annual carrying cost = total unit cost = 199680 * 1.50 = $ 299520 so carrying cost will be = $ 9984
Value of Good
Carry Cost
Qty. Order
Annual Carrying Cost
FTL
$120/80=$1.50
20%=0.3
49,920
$7,488
LTL
$1.50
0.3
7,680
$1,152
Difference
$6,336
Transportation cost:
FTL : if there are 4 orders per year and the order cost is $2300 per order so for the year it will be $9200
LTL: there are 26 orders and every order costs $760 so the cost for year is $19760 difference is of $11060
So the FTL will result in the benefit of $11060
Considerations:
Beehive ought to consider whether the interest for this item will stay at its abnormal states, and if the item has a substitute utilization if interest drops rapidly, and they are left with a lot of stock close by.
It likewise ought to be evaluated with the supplier in the event that they can oblige bigger requests, and if cost decreases or
Beehive Truss and Roof Corporation
Submitted to: Neda Onaran Submitted by: Ramneek Singh Tuli Student Id: 4235122 Date: 22nd March 2015
Provide a descriptive quantitative analysis of possible order quantities. the Cost factors that we need to find those includes:
Inventory carrying cost
Order processing cost
Transport cost first of all the demand for possible units would be there are 80 units in a box and there are 24 boxes on one pallet the number of pallets are 4. so the possible quantity of order will be : 4 * 24 * 80 = 7680 units possible quantity. possible order quantity per year will be = there is 7680 units demand bi weekly and for a year it will be
52 weeks /2 =26 weeks
7680*26 = 199680 Units
INVENTORY CARRYING COST there are more noteworthy conveying expenses to consider. Stock conveying expenses are communicated as the result of estimation of the great; the conveying expense and the normal amount available good value per unit =
$120 /80 = $1.50 per unit carrying cost per unit=
20% of per unit = 1.50 * 20% = .3 annual carrying cost = total unit cost = 199680 * 1.50 = $ 299520 so carrying cost will be = $ 9984
Value of Good
Carry Cost
Qty. Order
Annual Carrying Cost
FTL
$120/80=$1.50
20%=0.3
49,920
$7,488
LTL
$1.50
0.3
7,680
$1,152
Difference
$6,336
Transportation cost:
FTL : if there are 4 orders per year and the order cost is $2300 per order so for the year it will be $9200
LTL: there are 26 orders and every order costs $760 so the cost for year is $19760 difference is of $11060
So the FTL will result in the benefit of $11060
Considerations:
Beehive ought to consider whether the interest for this item will stay at its abnormal states, and if the item has a substitute utilization if interest drops rapidly, and they are left with a lot of stock close by.
It likewise ought to be evaluated with the supplier in the event that they can oblige bigger requests, and if cost decreases or