Question : SHORT ANSWER. Write the word or phrase that best completes each : 1196178

SHORT ANSWER.

Write the word or phrase that best completes each statement or answers the question. 70)

Due to unprecedented growth during the year Denise’s Flowers decided to use some of its surplus cash to increase the size of several inventory order quantities that had been previously determined using an EOQ model.

Required:

For each of the following items tell whether the action caused an increase, a decrease, or no change to the EOQ.

a.average inventory

b.cost of goods sold

c.number of orders per year

d.total annual carrying costs

e.total annual carrying and ordering costs

f.total annual ordering costs 70)

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71)

Berryton Products’ only product has an annual demand of 1,000 units. The cost of placing an order is $20 and the cost of carrying one unit in inventory for one year is $10.

Required:

Determine the economic order quantity. 71)

_____________

72)

Bottle It has one particular product that has an annual demand of 1,000 units. Total manufacturing costs per unit total $40 and set-up costs per batch are $15. Direct material ordering costs for the product total $10 per order. Currently the carrying costs per unit are 25 percent of manufacturing costs.

Required:

Determine the economic manufacturing (order) quantity. 72)

_____________

73)

The only product of a company has an annual demand of 2,000 units. The cost of placing an order is $40

and the cost of carrying one unit in inventory for one year is $16.

Required:

Determine the economic order quantity.

73)

_____________

74)

The annual demand for red, medium polo shirts, for Clothes, Inc. is 25,000 units. The cost of placing an order is $80, and the cost of carrying one unit in inventory for one year is $25.

Required:

a.Use the economic order quantity model to determine the optimal order size.

b.Determine the reorder point assuming a lead time of 10 days, and a work year of 250 days.

c.Assuming the maximum lead time is 20 days and the maximum daily demand is 125 units, determine the safety stock required to prevent stockouts. 74)

_____________

75)

An inventory item of XYZ Manufacturing has an average daily demand of 10 units with a maximum daily demand of 12 units. The economic order quantity is 200 units. The reorder point is 50 units. Safety stocks are set at 94 units.

Required:

a.Determine the inventory level at the time of reordering.

b.Determine the purchase order lead time.

d.Determine the maximum purchase order lead time that the company can experience before it has a stockout. 75)

_____________

76)

Ralph was in the process of completing the quarterly planning for the purchasing department when a

major computer malfunction lost most of his data. For direct material XXX he was able to recover the

following:

Average inventory level of XXX200

Orders per year40

Average daily demand48

Working days per year250

Annual ordering costs$4,000

Annual carrying costs$6,000

Ralph purchases at the EOQ quantity level.

Required:

Determine the annual demand, the cost of placing an order, the annual carrying cost of one unit, and the economic order quantity.

76)

_____________

77)

The IBP Grocery orders most of its items in lot sizes of 10 units. Average annual demand per side of beef is 720 units per year. Ordering costs are $25 per order with an average purchasing price of $100. Annual inventory carrying costs are estimated to be 40 percent of the unit cost.

Required:

a.Determine the economic order quantity.

b.Determine the annual cost savings if the shop changes from an order size of 10 units to the economic order quantity.

c.Since the shelf life is limited the IBP Grocery must keep the inventory moving. Assuming a 360-day year, determine the optimal lot size under each of the following: (1) a 20-day shelf life and (2) a 10-day shelf life. 77)

_____________

78)

For supply item ABC, Andrews Company has been ordering 125 units based on the recommendation of

the salesperson who calls on the company monthly. A new purchasing agent has been hired by the

company who wants to start using the economic-order-quantity method and its supporting decision

elements. She has gathered the following information:

Annual demand in units250

Days used per year250

Lead time, in days10

Ordering costs$100

Annual unit carrying costs$20

Required:

Determine the EOQ, average inventory, orders per year, average daily demand, reorder point, annual ordering costs, and annual carrying costs.

78)

_____________

79)

A jeweller orders gems in lot sizes of 1,250 gems. The annual demand for emeralds is 6,250 gems. Ordering costs are $200 per order and carrying costs are $10 per unit annually.

Required:

a.Determine the economic order quantity.

b.Determine the amount of annual cost savings if the company changes from an order size of 1,250 units to the economic order size.

c.One supplier offers a discount of $2 per unit off the purchase price of orders in lots of 625 units or more. What impact would this have on the EOQ and should the order size be changed? 79)

_____________

80)

The annual demand for a company’s product is 3,750 units, and monthly demand varies from 200 to 400 units with the following probability of demand:

200 units have a 25 percent probability

300 units have a 50 percent probability

400 units have a 25 percent probability

The EOQ model provides an optimal order quantity of 250 units. The opportunity costs of being out of stock are $2 per unit, with a carrying cost of $13 per unit, and the reorder point is 250 units.

Required:

a.Prepare a table showing stockouts, expected stockout costs, related carrying costs, and total costs, at each level of demand if the selected safety stocks are: 0, 50, 100 and 150.

b.What is the best level of safety stock to carry? 80)

_____________

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July 1, 2023

9.1 The United States in the International Economy

1) Following the tariff imposed on Chinese tires, some businesspeople correctly argued that the U.S. tariff would result in

A) China retaliating by raising tariffs on some U.S. exports.

B) China halting the sale of all products in the United States.

C) U.S. firms never being able to meet the demand for U.S.-produced tires.

D) the government demanding price cuts from U.S. tire manufacturers.

2) Workers in industries protected by tariffs and quotas are likely to support these trade restrictions because

A) they do not want to offend their employers who want them.

B) politicians lobby to convince workers the restrictions will make them better off.

C) they believe the restrictions will protect their jobs.

D) they don't understand that the restrictions will threaten their jobs.

3) The intention of the U.S. tariff on Chinese tires was to

A) protect jobs in the U. S. tire industry.

B) protect infant industries in tire U.S. tire market.

C) insure that Chinese tires meet U.S. quality and safety standards.

D) save the government money by restricting the sale of more expensive Chinese-made tires.

4) In the 1930s, the United States charged an average tariff rate ________. Today, the rate is ________.

A) of 100 percent; 20 percent

B) above 50 percent; less than 1.5 percent

C) of less than 10 percent; over 40 percent

D) of 17 percent; 33 percent

5) A tariff is a tax imposed by a government on

A) exports.

B) services.

C) imports.

D) luxury items.

6) Goods and services bought domestically but produced in other countries are referred to as

A) exports.

B) imports.

C) transfer payments.

D) foreign consumption.

7) Exports are domestically produced goods and services

A) sold to other countries.

B) sold to the government.

C) sold at home.

D) which are used to produce other goods and services.

8) When Roxanne, a U.S. citizen, purchases a designer dress from Barneys of New York that was made in Milan, the purchase is

A) both a U.S. and an Italian import.

B) a U.S. import and an Italian export.

C) a U.S. export and an Italian import.

D) neither an export nor an import for either country.

9) When BMW, a German company, purchases a welding machine that was made in Toronto, the purchase is

A) both a German and a Canadian import.

B) a German import and a Canadian export.

C) a German export and a Canadian import.

D) neither an export nor an import for either country.

10) Which of the following statements about the importance of trade to the U.S. economy is true?

A) Since 1950, both exports and imports have steadily decreased as a fraction of U.S. gross domestic product.

B) Overall, about 80 percent of U.S. manufacturing jobs depend directly or indirectly on exports.

C) The United States is the second largest exporter in the world.

D) The U.S. economy is highly dependent on international trade for growth in its gross domestic product.