Case Study Report 1: THREE JAYS CORPORATION; SOC 200 - Comprehensive

1. Using the data in case Exhibit 4 and the 2012 annual demand, calculate the EOQ and ROP quantities for the five SKUs scheduled to be produced in the last week of June. How do these amounts compare with those calculated in 2011? Compare the increases in EOQs with the increases in annual demand. (2.5 points) The 2012 Annual Demand is given as Label Type 2012 345 301 325 299 344 296 329 334 349 325 289 333 3,869 Marran Markets Raspberry Jelly Dom's Food Stores Blueberry Jam The EOQ and ROP quantities for the five SKU’s based on 2012 annual demand is given as Total Set up cost (S) Annual Deman d (D) Carryin g Cost (i) % Unit Cost (C) EOQ (cases) ROP (cases) Strawberry Jam 63.7 3869 9% 28.34 440 223 Raspberry Jam 63.7 3006 9% 30.52 373 173 Peach Jam 63.7 1970 9% 26.86 322 114 Blueberry Jam 63.7 1211 9% 29.01 243 70 Apple/Mint Jelly 63.7 832 9% 26.32 212 48 As Demand increased from 2011 to 2012, the EOQ’s also increased Deman d (2010) Deman d (2012) Increase in Demand EOQ (2010) EOQ (2012) Increase in EOQ 2993 3869 29.27% 387 440 13.70% 2335 3006 28.74% 329 373 13.37% 1492 1970 32.04% 280 322 15.00% 886 1211 36.68% 208 243 16.83% 625 832 33.12% 183 212 15.85% So, if Annual Demand doubles, the EOQ will increase by sqrt(2)