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    Operations Management LPM Functions

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    What LPM function should I use? MAx or Min? Integer?

    The Southern States Lumber and Mill Company, a logging and milling operation in the southern US, processes 10,000 logs during 250 operating days each year. Immediately upon receiving an order, the logging companyâ??s supplier begins delivery to the lumber mill at a rate of 60 logs per day. The lumber mill operators have determined that the cost of placing an order is $1600 and that the cost of carrying logs in inventory prior to processing is $15 per log on an annual basis.
    a. Determine the optimal order size.
    b. Determine the total inventory cost associated with an optimal inventory ordering policy.
    c. Determine the number of operating days between orders under an optimal ordering policy.
    d. Determine the number of operating days required to receive an order under an optimal policy.

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    Solution Preview

    The Southern States Lumber and Mill Company, a logging and milling operation in the southern US, processes 10,000 logs during 250 operating days each year. Immediately upon receiving an order, the logging companyâ??s supplier begins delivery to the lumber mill at a rate of 60 logs per day. The lumber mill operators have ...

    Solution Summary

    The expert examines operations management for LPM functions. The optimal order size are given.

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