1.

Dependent demand is defined as demand for materials or parts that are

directly related to the structure of the bill of materials for the final product.
example: McD already set McMuffin manufacture 500 pieces
Independent demand is the demand for material that is not related to the bill
of materials. The products are classified into an independent project for
forecasting demand.
for example: new products McD Mighty-wings where the McD can not
estimate its sales
6.
Investigation of ordering and production setup cost will likely show that a
single, unique cost does not exist for each product, nor is it linearly related to
the number of order.
An inventory ordering cost based on the number or orders per year (as is
done in most inventory models), reducing the number of orders the individual
places does not necessarily decrease the net cost to the firm since his weekly
pay remains the same.
The terms carrying or holding costs for maintaining goods in inventory
include a multitude of cost elements. To determine the nature and amounts
of these costs can be a challenging feat.
In the simple inventory model, holding costs are based on the average
inventory on hand.
7.
as long as the company has an accurate estimate, it is the ease of making
goods. because the calculations are accurate, the company can take and
return the goods as desired.
but even so, the company must remain properly analyze expenses in order to
avoid any loss or bankruptcy.
8.
(a)
Supplying kitchen with foodboth a periodic model and order quantity.
Generally, a household will shop once weekly for the majority of items
(periodic), then pick up items such as bread and milk as the supply runs low
(fixed quantity with reorder point).
(b)
Obtaining a daily newspapera daily newspaper is obviously a periodic
model. One does not usually wait until he has finished one daily paper before
buying the next days paper.
(c)
Buying gas for your cargenerally, this is a hybrid type model wherein
a reorder point is signaled when the gas indicator is low, then the tank is
filled. Many people, however, have a fixed quantity purchase when the
reorder point is reached.

The highest stockout cost for most well-fed, well-read individuals would be
running out of gas in your car. The cost could range from practically zero if
one runs out in front of a gas stationto being late for an appointment or
causing an accident on the highway.
9.
Using a classification scheme such as this one allows a greater portion of
time to be spent in controlling specific groups or classes or items. For the
ABC grouping, greater control is afforded those items which comprise the
greatest dollar volume in usage. The result of this classification is a reduction
in the overall inventory size and, therefore, decreased costs for the same
level of satisfying inventory demands.
10.
A wide variety of alternative methods for inventory control are available for
retail stores. The most notable recent innovation is the introduction of an
electronic cash register, which, in addition to tabulating specific cash receipt
categories as in conventional cash registers, will also update inventory levels.
Future usage will extend to checking credit, and verifying credit cards through
direct linkage to a computer data file.
Other attempts in the past in trying to improve inventory control are through
pre-punched and coded tags on all items that are collected at the checkout
counter and periodically tabulated.