PLEASE HELP WITH ANSWER TO A&B!!! PLEASE Problem 6 Question Help Wanda Lux must

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PLEASE HELP WITH ANSWER TO A&B!!! PLEASE

Problem 6 Question Help Wanda Lux must select a supplier for a plastic bottle and proprietary dispenser for its new hair shampoo. Three suppliers have placed bids; at Wanda's request, all bids are for a shipping quantity (Q) of 20,000 bottles with annual requirements (D) of 40,000 units. Wanda's factory operates 250 days a year. The following table shows each supplier's price, estimated annual freight costs, and current lead times; management has added estimates for holding costs and administrative oversight costs for each supplier Supplier Dover Plastics Evan & Sons Farley, Inc Freight Price/Unit Annual Holding Lead Time Annual Administrative Costs $3,000 $3,500 $4,500 Costs $4,000 $5,000 $6,000 Cost/Unit (H) L)days) $5.05 $5.15 $5.10 $1.01 $1.03 $1.02 13 18 a. Which of the three suppliers will provide the lowest annual cost to Wanda Lux? Using | ?| is the lowest cost alternative, with annual total costs to Wanda Lux of $ . (Enter your response rounded to the nearest whole number.) Enter your answer in the answer box and then click Check Answer Clear All Check Answer remaining ng 10th Editiorn 5th Edition 3rd Edition b. Given Wanda's criteria and weighting system, which supplier should Wanda award the contract to? View all solutions

Explanation / Answer

Answer:

Company Wanda Lux needs a supplier for sourcing of plastic bottles and proprietary dispenses.

Calculate the daily requirements for the company Wanda Lux, as follows:

= 40000 bottles /250 = 160 Bottles

Now, calculate the total annual costs for each alternative, as shown below.

Total Annual Cost = Material cost+ Freight Cost+ inventory cost +administrative cost

Annual cost of Supplier DP:

= 5.05*40000+ 3000+((20000/2+(160*13*1.01)) + 4000 = $221101

Annual cost of Supplier ES:

= 5.15*40000+ 3500+((20000/2+(160*18*1.03)) + 5000 = $227466

Annual cost of Supplier FI:

= 5.10*40000+ 4500+((20000/2+(160*17*1.02)) + 6000 = $227274

Therefore, from the above analysis, Supplier DP would provide the lowest annual cost $221101 to Wanda Lux company.

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