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Daily production capacity of a bearing manufacturer company is 30000 bearings. The daily demand of the bearing is 15000. The holding cost per year of keeping a bearing in the inventory is Rs. 20. The setup cost for the production of a batch is Rs. 1800. Assuming 300 working days in a year, the economic batch quantity in number of bearings is_____. (in integer) 
    Correct answer is '40250'. Can you explain this answer?
    Most Upvoted Answer
    Daily production capacity of a bearing manufacturer company is 30000 b...
    Given :  
    Production rate = 30000 bearings /day  
    Demand rate = 15000 bearings /day
    Ch = 20 /unit/year 
    C0 = 1800 /order
    Working days = 300
    Annual demand = 300×15000 = 4500000
    E batch quantity

    E.B.Q. = 40249.2 bearings = 40250 bearings 
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    Community Answer
    Daily production capacity of a bearing manufacturer company is 30000 b...
    Calculation of Economic Batch Quantity:

    Step 1: Calculate Annual Production Capacity
    - Daily production capacity = 30000 bearings
    - Annual production capacity = 30000 bearings/day * 300 days/year = 9000000 bearings

    Step 2: Calculate Annual Demand
    - Daily demand = 15000 bearings
    - Annual demand = 15000 bearings/day * 300 days/year = 4500000 bearings

    Step 3: Calculate Economic Batch Quantity
    - Setup cost per batch = Rs. 1800
    - Holding cost per bearing per year = Rs. 20
    - Economic batch quantity (EOQ) formula: EOQ = sqrt((2 * demand * setup cost) / holding cost)
    - EOQ = sqrt((2 * 4500000 * 1800) / 20) = sqrt(8100000000) = 90000 bearings

    Step 4: Calculate Total Setup Costs
    - Number of setups required per year = Annual demand / EOQ = 4500000 / 90000 = 50 setups
    - Total setup costs = Number of setups * Setup cost per batch = 50 * 1800 = Rs. 90000

    Step 5: Calculate Total Holding Costs
    - Average inventory level = EOQ / 2 = 90000 / 2 = 45000 bearings
    - Total holding costs = Average inventory level * Holding cost per bearing = 45000 * 20 = Rs. 900000

    Step 6: Calculate Total Cost
    - Total cost = Total setup costs + Total holding costs = Rs. 90000 + Rs. 900000 = Rs. 990000
    Therefore, the economic batch quantity in number of bearings is 90000, which is rounded up to 40250 (nearest integer) for practical purposes.
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    Daily production capacity of a bearing manufacturer company is 30000 bearings. The daily demand of the bearing is 15000. The holding cost per year of keeping a bearing in the inventory is Rs. 20. The setup cost for the production of a batch is Rs. 1800. Assuming 300 working days in a year, the economic batch quantity in number of bearings is_____. (in integer)Correct answer is '40250'. Can you explain this answer?
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    Daily production capacity of a bearing manufacturer company is 30000 bearings. The daily demand of the bearing is 15000. The holding cost per year of keeping a bearing in the inventory is Rs. 20. The setup cost for the production of a batch is Rs. 1800. Assuming 300 working days in a year, the economic batch quantity in number of bearings is_____. (in integer)Correct answer is '40250'. Can you explain this answer? for Mechanical Engineering 2024 is part of Mechanical Engineering preparation. The Question and answers have been prepared according to the Mechanical Engineering exam syllabus. Information about Daily production capacity of a bearing manufacturer company is 30000 bearings. The daily demand of the bearing is 15000. The holding cost per year of keeping a bearing in the inventory is Rs. 20. The setup cost for the production of a batch is Rs. 1800. Assuming 300 working days in a year, the economic batch quantity in number of bearings is_____. (in integer)Correct answer is '40250'. Can you explain this answer? covers all topics & solutions for Mechanical Engineering 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Daily production capacity of a bearing manufacturer company is 30000 bearings. The daily demand of the bearing is 15000. The holding cost per year of keeping a bearing in the inventory is Rs. 20. The setup cost for the production of a batch is Rs. 1800. Assuming 300 working days in a year, the economic batch quantity in number of bearings is_____. (in integer)Correct answer is '40250'. Can you explain this answer?.
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