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Value Gadgets Corp produces J-Pods, music players that can download thousands of songs Value Gadgets forecasts that demand 2020 will be 54,600 J-Pods The variable production cost of each J.Pod is $54 In its MRP system, due to the large $7,800 cost per setup. Value Gadgets plans to produce J-Pods once a month in batches of 4,550 units. The carrying cost of a unit in inventory is $14 per year. Read the reguirements Requirement 1. Using the MRP system, what is the annual cost of producing and carrying J-Pods in inventory? (Assume that, on average, half of the units produced in a month are in inventory) Begin by determining the formula, then calculate the annual cost of producing and carrying J.Pods in inventory, using an MRR system (Round your answer to the nearest whole doliar) Requirements 1. Using the MRP system, what is the annual cost of producing and carrying J-Pods in inventory? (Assume that, on average, half of the units produced in a month are in inventory.) 2. A new manager at Value Gadgets has suggested that the company use the EOQ model to determine the optimal batch size to produce. (To use the EOQ model, Value Gadgets needs to treat the setup cost in the same way it would treat ordering cost in a traditional EOQ model.) Determine the optimal batch size and number of batches. Round up the number of batches to the nearest whole number. What would be the annual cost of producing and carrying J-Pods in inventory if it uses the optimal batch size? Compare this cost to the cost calculated in requirement 1 Comment briefly. 3. Value Gadgets is also considening switching from an MRP system to a JIT system. This will result in producing J-Pods in batch sizes of 200 J.Pods and will reduce obsolescence, improve quality, and result in a higher sellina price. Value Gadqets will reduce setup time and setup treat the setup cost in the same way it would treat ordering cost in a tradifional EOQ model.) Determine the optimal batch size and number of batches. Round up the number of batches to the nearest whole number. What would be the annual cost of producing and carrying J-Pods inventory if it uses the optimal batch size? Compare this cost to the cost calculated in requirement 1. Comment briefly. 3. Value Gadgets is also considering switching from an MRP system to a JIT system. This will result in producing J-Pods in batch sizes of 200 J-Pods and will reduce obsolescence, improve quality, and result in a higher selling price. Value Gadgets will reduce setup time and setup cost. The new setup cost will be $100 per setup. What is the annual cost of producing and carrying J-Pods in inventory under the JIT system? 4. Compare the models analyzed in the previous parts of the problem. What are the advantages and disadvantages of each

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