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Ne4ueva [31]
3 years ago
7

Tammi’s Truck Stop sells Seat-o-Nails cushions, which are specially designed to keep drivers awake on the road. Her accessories

supplier makes deliveries every Tuesday, at which times she can get as many cushions as she wants (the supplier’s truck carries a large number of cushions). The cushions cost $40 wholesale, and Tammi sells them for $65. She also uses a 35 percent interest rate to evaluate the cost of holding inventory. Today it is Tuesday, Tammi has 12 cushions in stock, and the supplier has just arrived. Assuming that the weekly demand is normally distributed with mean 35 and standard deviation 10, answer the questions below. (hint: use newsvendor model)How many cushions should Tammi buy if sales are lost when she runs out of stock during the week?Reconsider part (a) if unmet demand is not lost but it is back ordered, and it costs Tammi $12 to mail the cushion to the customer.
Business
1 answer:
adell [148]3 years ago
3 0

Answer:

Explanation:

(a) The cost of underage(Cu) will be the opportunity cost for lost sales which will be:

= 65 - 40

= 25

The cost of overage(Co) will be the holding cost which will be:

= 40 x 35%/52

= 40 × 0.35/52

= 40 × 0.0067308

= 0.269

The Critical ratio will be:

= Cu/(Cu + Co)

= 25/(0.269+25)

= 0.9894

For the optimal condition,

F(z) = Critical ratio = 0.9894,

therefore, z = normsinv (0.9894) = 2.30

Therefore, the optimal stock will be calculated as:

= Mean demand + (z × Stdev)

= 35 + (2.30 × 10)

= 35 + 23

= 58 units.

We should note that Tammi already has 12 cushions in stock, therefore the order quantity will be:

= 58 - 12

= 46 units

(b) Cu = 12

Co = 0.269

Critical ratio will be:

= Cu/(Co + Cu)

= 12 / (12 + 0.269)

= 0.9781

Therefore, z = normsinv(0.9781) = 2.0

Then, the optimal stock will be:

= 35 + (2.0 × 10)

= 35+20

= 55 units

We should note that Tammi already has 12 cushions in stock, therefore the order quantity will be:

= 55 - 12

= 43 units

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Neuman Corporation Convertible Bonds The following data apply to Neuman Corporation's convertible bonds: Maturity: 10 Stock pric
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Answer:

A. The bond’s conversion ratio is 28.57

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Explanation:

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A manager experiences a cashier shortage that averages $50. 00 per day. if the manager's operation is open 360 days per year, wh
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In colloquial language, the average is a single number representing a list of numbers, usually the sum of the numbers divided by the number of numbers in the list. For example, the average of the numbers 2, 3, 4, 7, and 9 is 5.

Suppose there are four types of means: mean, mode, median, and range. In fact, the range is a measure of spread or spread, while others are the most common "measure of central tendency".

Noun. Mean, Mean, Median, Standard means something that represents the midpoint. The average is the quotient obtained by dividing the sum of a set of numbers by the number of numbers. scored an average of 85 points on the test. The mean is the simple mean or the middle value between the two extremes.

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Suppose a small business has sales of $15,000 this month, with future sales expected to grow by $1,600 each month. Costs consist
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Answer:

$8,220

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Gross Profit = Sales - Fixed Cost - Variable Cost

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F. Debit Advertising Expense and credit Cash.

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G. Debit Cash and credit Service Revenue.

  • You sold meals and your clients paid you in cash.

7 0
3 years ago
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