GATE Questions & Answers of Inventory Control Mechanical Engineering

A local tyre distributor expects to sell approximately 9600 steel belted radial tyres next year. Annual carrying cost is Rs. 16 per tyre and ordering cost is Rs. 75. The economic order quantity of the tyres is

Annual demand of a product is 50000 units and the ordering cost is Rs.7000 per order. Considering the basic economic order quantity model, the economic order quantity is 10000 units. When the annual inventory cost is minimized, the annual inventory holding cost (in Rs.) is ________.

Sales data of a product is given in the following table:

Month January February March April May
Number of units sold 10 11 16 19 25

Regarding forecast for the month of June, which one of the following statements is TRUE?

The annual requirement of rivets at a ship manufacturing company is 2000 kg. The rivets are supplied in units of 1 kg costing Rs. 25 each. If it costs Rs. 100 to place an order and the annual cost of carrying one unit is 9% of its purchased cost, the cycle length of the order (in days) will be___________

Consider the following data with reference to elementary deterministic economic order quantity model

Annual demand of an item 100000
Unit price of the item (in Rs.) 10
Inventory carrying cost per unit per year (in Rs.) 1.5
Unit order cost (in Rs.) 30

The total number of economic orders per year to meet the annual demand is _______

A  manufacturer  can produce 12000 bea arings per day.The manufacturer received an order of 8000 bearings per day from a customer.The  cost of holding a bearing in stock is Rs. 0.20 per month.Setup cost per production run is RS 500 Assuming  300 working days in a year, the frequency of production run should be

Demand during lead time with associated probabilities is shown below:

Demand 50 70 75 80 85
Probability 0.15 0.14 0.21 0.20 0.30

Expected demand during lead time is _______

Annual demand for window frames is 10000. Each frame costs Rs. 200 and ordering cost is RS. 300 per order. Inventory holding cost is Rs. 40 per frame per year. The supplier is willing to offer 2% discount if the order quantity is 1000 or more, and 4% if order quantity is 2000 or more. If the total cost is to be minimized, the retailer should

A company uses 2555 units of an item annually. Delivery lead time is 8 days. The recorder point (in number of units) to achieve optimum inventory is

A set of 5 jobs is to be processed on a single machine. The processing time (in days)is given below. The holding cost for each job is Rs. K per day

Job Processing time
P 5
Q 2
R 3
S 2
T 1

A schedule that minimizes the total inventory cost is

Capacities of production of an item over 3 consecutive months in regular time are 100, 100 and 80 and in overtime are 20, 20 and 40. The demands over those 3 months are 90, 130 and 110. The cost of production in regular time and overtime are respectively Rs. 20 per item and Rs. 24 per item. Inventory carrying cost is Rs. 2 per item per month. The levels of starting and final inventory are nil. Backorder is not permitted. For minimum cost of plan, the level of planned production in overtime in the third month is

The maximum level of inventory of an item is 100 and it is achieved with infinite replenishment rate. The inventory becomes zero over one and half month due to consumption at a uniform rate. This cycle continues throughout the year. Ordering cost is Rs. 100 per order and inventory carrying cost is Rs. 10 per item per month. Annual cost (in Rs.) of the plan, neglecting material cost, is

In a machine shop, pins of 15 mm diameter are produced at a rate of 1000 per month and the same is consumed at a rate of 500 per month. The production and consumption continue simultaneously till the maximum inventory is reached. Then inventory is allowed to reduced to zero due to consumption. The lot size of production is 1000. If backlog is not allowed, the maximum inventory level is

The net requirements of an item over 5 consecutive weeks are 50 – 0 – 15 – 20 – 20. The inventory carrying cost and ordering cost are Re. 1 per item per week and Rs. 100 per order respectively. Starting inventory is zero. Use “Least Unit Cost Technique “for developing the plan. The cost of the plan (in Rs.) is