Harley Davidson Case Study

Decent Essays
Question 2: Harley Davidson | | | | | Harley Davidson has its engine assembly plant in Milwaukee and its motorcycle assembly plant in Pennsylvania. Engines are transported between the two plants using trucks. Each truck trip costs $1,000. The motorcycle plant assembles and sells 300 motorcycles each day. Each engine costs $500 and Harley incurs a holding cost of 20 percent per year. How many engines should Harley load onto each truck? What is the cycle inventory of engines at Harley? | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Input | | | | | | Demand, R = | | 109,500 | (assuming 365 operating days) | Fixed cost per order, S= | $ 1,000 | | | | Cost per engine, C = | $ 500 | | | | Holding cost, h= | | 20% | | | | | | | | | | Output | | | | | | EOQ = | | 1,480 | | | | # of orders per year | | 74 | | | | Annual Order Cost | | $ 73,993 | | | | Cycle inventory (units) | 740 | | | | …show more content…
1260 | $86,905 | $63,000 | $149,905 | | | 1280 | $85,547 | $64,000 | $149,547 | | | 1300 | $84,231 | $65,000 | $149,231 | | | 1320 | $82,955 | $66,000 | $148,955 | | | 1340 | $81,716 | $67,000 | $148,716 | | | 1360 | $80,515 | $68,000 | $148,515 | | | 1380 | $79,348 | $69,000 | $148,348 | | | 1400 | $78,214 | $70,000 | $148,214 | | | 1420 | $77,113 | $71,000 | $148,113 | | | 1440 | $76,042 | $72,000 | $148,042 | | | 1460 | $75,000 | $73,000 | $148,000 | | | 1480 | $73,986 | $74,000 | $147,986 | | | 1500 | $73,000 | $75,000 | $148,000 | | | 1520 | $72,039 | $76,000 | $148,039 | | | 1540 | $71,104 | $77,000 | $148,104 | | | 1560 | $70,192 | $78,000 | $148,192 | | | 1580 | $69,304 | $79,000 | $148,304 | | | 1600 | $68,438 | $80,000 | $148,438 | | | 1620 | $67,593 | $81,000 | $148,593 | | | 1640 | $66,768 | $82,000 | $148,768 | | | 1660 | $65,964 | $83,000 | $148,964 | | | 1680 | $65,179 | $84,000 | $149,179 | | | 1700 | $64,412 | $85,000 | $149,412 | | | 1720 | $63,663 | $86,000 | $149,663 | | | 1740 | $62,931 | $87,000 | $149,931 | | | 1760 | $62,216 | $88,000 | $150,216 | | | 1780 | $61,517 | $89,000 | $150,517 | |

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