case assignment
hbouhamad
ex_11-16.xlsxEx. 11.16 check
| Marginal Unit Quantity Discount (Exercise 11-16) | ||||
| Fixed cost per order = | $ 500.00 | |||
| Monthly demand = | 5,000 | |||
| Holding percentage = | 25% | |||
| Pricing: | ||||
| Min Qty | Max Qty | Price per phone | ||
| 0 | 10,000 | $ 200.00 | ||
| 10,000 | 20,000 | $ 195.00 | ||
| 20,000 | $ 190.00 | |||
| Range | V | Q | Adjust to Q | Total Cost |
| 0.0 | 0 | 1,095 | 1,095 | $ 12,054,772 |
| 1.0 | 2,000,000 | 11,149 | 11,149 | $ 12,249,780 |
| 2.0 | 3,950,000 | 19,499 | 20,000 | $ 12,345,250 |
| Without Quantity Discount | ||||
| Price per phone | Q | Total Cost | ||
| $ 200.00 | 10,954 | $ 12,005,477 |
&A
ex. 11.16
| Marginal Unit Quantity Discount (Exercise 11-16) | |||||
| Fixed cost per order = | $ 500 | per order | |||
| Monthly demand = | 5,000 | phones | |||
| Holding percentage = | 25% | ||||
| Pricing: | Quantity | Price per phone | |||
| <10,000 | $ 200.00 | ||||
| 10,000-20,000 | $ 195.00 | ||||
| >20,000 | $ 190.00 | ||||
| Initial Order Quantity = | 1,000 | ||||
| Increment in Order Quantity = | 1,000 | ||||
| Order | Average | Annual | Annual | Annual | Total |
| Quantity | Unit Cost | Holding Cost | Order Cost | Material Cost | Annual Cost |
| 1000.0 | $ 200.000 | $ 25,000 | $ 30,000 | $ 12,000,000 | $ 12,055,000 |
| 2000.0 | $ 200.000 | $ 50,000 | $ 15,000 | $ 12,000,000 | $ 12,065,000 |
| 3000.0 | $ 200.000 | $ 75,000 | $ 10,000 | $ 12,000,000 | $ 12,085,000 |
| 4000.0 | $ 200.000 | $ 100,000 | $ 7,500 | $ 12,000,000 | $ 12,107,500 |
| 5000.0 | $ 200.000 | $ 125,000 | $ 6,000 | $ 12,000,000 | $ 12,131,000 |
| 6000.0 | $ 200.000 | $ 150,000 | $ 5,000 | $ 12,000,000 | $ 12,155,000 |
| 7000.0 | $ 200.000 | $ 175,000 | $ 4,286 | $ 12,000,000 | $ 12,179,286 |
| 8000.0 | $ 200.000 | $ 200,000 | $ 3,750 | $ 12,000,000 | $ 12,203,750 |
| 9000.0 | $ 200.000 | $ 225,000 | $ 3,333 | $ 12,000,000 | $ 12,228,333 |
| 10000.0 | $ 200.000 | $ 250,000 | $ 3,000 | $ 12,000,000 | $ 12,253,000 |
| 11000.0 | $ 199.545 | $ 274,375 | $ 2,727 | $ 11,972,727 | $ 12,249,830 |
| 12000.0 | $ 199.167 | $ 298,750 | $ 2,500 | $ 11,950,000 | $ 12,251,250 |
| 13000.0 | $ 198.846 | $ 323,125 | $ 2,308 | $ 11,930,769 | $ 12,256,202 |
| 14000.0 | $ 198.571 | $ 347,500 | $ 2,143 | $ 11,914,286 | $ 12,263,929 |
| 15000.0 | $ 198.333 | $ 371,875 | $ 2,000 | $ 11,900,000 | $ 12,273,875 |
| 16000.0 | $ 198.125 | $ 396,250 | $ 1,875 | $ 11,887,500 | $ 12,285,625 |
| 17000.0 | $ 197.941 | $ 420,625 | $ 1,765 | $ 11,876,471 | $ 12,298,860 |
| 18000.0 | $ 197.778 | $ 445,000 | $ 1,667 | $ 11,866,667 | $ 12,313,333 |
| 19000.0 | $ 197.632 | $ 469,375 | $ 1,579 | $ 11,857,895 | $ 12,328,849 |
| 20000.0 | $ 197.500 | $ 493,750 | $ 1,500 | $ 11,850,000 | $ 12,345,250 |
| 21000.0 | $ 197.143 | $ 517,500 | $ 1,429 | $ 11,828,571 | $ 12,347,500 |
| 22000.0 | $ 196.818 | $ 541,250 | $ 1,364 | $ 11,809,091 | $ 12,351,705 |
| 23000.0 | $ 196.522 | $ 565,000 | $ 1,304 | $ 11,791,304 | $ 12,357,609 |
| 24000.0 | $ 196.250 | $ 588,750 | $ 1,250 | $ 11,775,000 | $ 12,365,000 |
| 25000.0 | $ 196.000 | $ 612,500 | $ 1,200 | $ 11,760,000 | $ 12,373,700 |
| 26000.0 | $ 195.769 | $ 636,250 | $ 1,154 | $ 11,746,154 | $ 12,383,558 |
| 27000.0 | $ 195.556 | $ 660,000 | $ 1,111 | $ 11,733,333 | $ 12,394,444 |
| 28000.0 | $ 195.357 | $ 683,750 | $ 1,071 | $ 11,721,429 | $ 12,406,250 |
| 29000.0 | $ 195.172 | $ 707,500 | $ 1,034 | $ 11,710,345 | $ 12,418,879 |
| 30000.0 | $ 195.000 | $ 731,250 | $ 1,000 | $ 11,700,000 | $ 12,432,250 |
| 31000.0 | $ 194.839 | $ 755,000 | $ 968 | $ 11,690,323 | $ 12,446,290 |
| 32000.0 | $ 194.688 | $ 778,750 | $ 938 | $ 11,681,250 | $ 12,460,938 |
| 33000.0 | $ 194.545 | $ 802,500 | $ 909 | $ 11,672,727 | $ 12,476,136 |
| 34000.0 | $ 194.412 | $ 826,250 | $ 882 | $ 11,664,706 | $ 12,491,838 |
| 35000.0 | $ 194.286 | $ 850,000 | $ 857 | $ 11,657,143 | $ 12,508,000 |
| 36000.0 | $ 194.167 | $ 873,750 | $ 833 | $ 11,650,000 | $ 12,524,583 |
| 37000.0 | $ 194.054 | $ 897,500 | $ 811 | $ 11,643,243 | $ 12,541,554 |
| 38000.0 | $ 193.947 | $ 921,250 | $ 789 | $ 11,636,842 | $ 12,558,882 |
| 39000.0 | $ 193.846 | $ 945,000 | $ 769 | $ 11,630,769 | $ 12,576,538 |
| 40000.0 | $ 193.750 | $ 968,750 | $ 750 | $ 11,625,000 | $ 12,594,500 |
| 41000.0 | $ 193.659 | $ 992,500 | $ 732 | $ 11,619,512 | $ 12,612,744 |
| 42000.0 | $ 193.571 | $ 1,016,250 | $ 714 | $ 11,614,286 | $ 12,631,250 |
| 43000.0 | $ 193.488 | $ 1,040,000 | $ 698 | $ 11,609,302 | $ 12,650,000 |
| 44000.0 | $ 193.409 | $ 1,063,750 | $ 682 | $ 11,604,545 | $ 12,668,977 |
| 45000.0 | $ 193.333 | $ 1,087,500 | $ 667 | $ 11,600,000 | $ 12,688,167 |
| 46000.0 | $ 193.261 | $ 1,111,250 | $ 652 | $ 11,595,652 | $ 12,707,554 |
| 47000.0 | $ 193.191 | $ 1,135,000 | $ 638 | $ 11,591,489 | $ 12,727,128 |
| 48000.0 | $ 193.125 | $ 1,158,750 | $ 625 | $ 11,587,500 | $ 12,746,875 |
| 49000.0 | $ 193.061 | $ 1,182,500 | $ 612 | $ 11,583,673 | $ 12,766,786 |
| 50000.0 | $ 193.000 | $ 1,206,250 | $ 600 | $ 11,580,000 | $ 12,786,850 |
| 51000.0 | $ 192.941 | $ 1,230,000 | $ 588 | $ 11,576,471 | $ 12,807,059 |
| 52000.0 | $ 192.885 | $ 1,253,750 | $ 577 | $ 11,573,077 | $ 12,827,404 |
| 53000.0 | $ 192.830 | $ 1,277,500 | $ 566 | $ 11,569,811 | $ 12,847,877 |
| 54000.0 | $ 192.778 | $ 1,301,250 | $ 556 | $ 11,566,667 | $ 12,868,472 |
| 55000.0 | $ 192.727 | $ 1,325,000 | $ 545 | $ 11,563,636 | $ 12,889,182 |
| 56000.0 | $ 192.679 | $ 1,348,750 | $ 536 | $ 11,560,714 | $ 12,910,000 |
| 57000.0 | $ 192.632 | $ 1,372,500 | $ 526 | $ 11,557,895 | $ 12,930,921 |
| 58000.0 | $ 192.586 | $ 1,396,250 | $ 517 | $ 11,555,172 | $ 12,951,940 |
| 59000.0 | $ 192.542 | $ 1,420,000 | $ 508 | $ 11,552,542 | $ 12,973,051 |
| 60000.0 | $ 192.500 | $ 1,443,750 | $ 500 | $ 11,550,000 | $ 12,994,250 |
| 61000.0 | $ 192.459 | $ 1,467,500 | $ 492 | $ 11,547,541 | $ 13,015,533 |
| 62000.0 | $ 192.419 | $ 1,491,250 | $ 484 | $ 11,545,161 | $ 13,036,895 |
&A
ex. 11.16 chart
Total Cost With Varying Order Size
1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 12000 13000 14000 15000 16000 17000 18000 19000 20000 21000 22000 23000 24000 25000 26000 27000 28000 29000 30000 31000 32000 33000 34000 35000 36000 37000 38000 39000 40000 41000 42000 43000 44000 45000 46000 47000 48000 49000 50000 51000 52000 53000 54000 55000 56000 57000 58000 59000 60000 61000 62000 12055000 12065000 12085000 12107500 12131000 12155000 12179285.714285715 12203750 12228333.333333334 12253000 12249829.545454545 12251250 12256201.923076922 12263928.571428571 12273875 12285625 12298860.294117648 12313333.333333332 12328848.684210526 12345250 12347500 12351704.545454545 12357608.695652174 12365000 12373700 12383557.692307692 12394444.444444444 12406250 12418879.310344828 12432250 12446290.322580645 12460937.5 12476136.363636363 12491838.2 35294117 12508000 12524583.333333334 12541554.054054054 12558881.578947369 12576538.46153846 12594500 12612743.902439024 12631250 12650000 12668977.272727273 12688166.666666666 12707554.347826088 12727127.65957447 12746875 12766785.714285715 12786850 12807058.823529413 12827403.846153848 12847877.358490566 12868472.222222222 12889181.818181818 12910000 12930921.052631579 12951939.655172413 12973050.847457629 12994250 13015532.786885247 13036895.161290321Order Size ('000)
Annual Cost
