Supply chain calculation questions

QUESTION

Given the following data, answer the questions below:

Daily Demand = 275 units

SD of Daily Demand = 44 units

Average inventory units = 2,500 units

Cost of 1 unit = $100

Average inventory value = $250,000

Cost of Goods sold (per year) = $9,900,000

Average Replenishment Cycle (Lead time) = 12 days

SD of Replenishment Cycle = 2 days

(Working) Days per year = 360 days

Current number of warehouses = 16

  1. What is the number of inventory turns?
  2. How much safety stock should the company hold if it wants to ensure a 99% service level?
  3. If the company wants to close 12 of their warehouses, how much inventory should they expect to have afterwards?
  4. If the company is considering adding 4 warehouses to their existing 16, how much inventory should they expect to have afterwardss?

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