Operations Management savings question – Best Nursing Tutor

Operations Management savings question – Best Nursing Tutor

Here is the problem I am stuck on. I am getting lost on the last part of the problem. How do I calculate the savings?
A chemical firm produces sodium bisulfate in 100-pound bags. Demand for this product is 25 tons per day. The capacity for producing the product is 50 tons per day. Setup costs $100, and storage and handling costs are $8 per ton a year. The firm operates 200 days a year. (Note: 1 ton = 2,000 pounds.)
a. How many bags per run are optimal? (Round your answer to the nearest whole number.)
Number of bags:
b. What would the average inventory be for this lot size? (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number.)
Average inventory bags:
c. Determine the approximate length of a production run, in days. (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number.)
Run length days:
d. About how many runs per year would there be? (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number.)
Run per year:
e. How much could the company save annually if the setup cost could be reduced to $33 per run?(Round your intermediate calculations and final answer to 2 decimal places. Omit the “$” sign in your response.)
Savings:
Solution I get from the book is the following:
Where is the $1,148.93 coming from? How do I calculate TCrev?