Expert Answer:Superfun Toys International Business Strategy & St

  

Solved by verified expert:Assignment steps add 300 words to the attached case study. The section is probability of stock paragraph.also compute the information below in the attached spreadsheet.Compute the probability of a stock-out for the order quantities suggested by members of the management team (i.e. 15,000; 18,000; 24,000; 28,000).
team_a_excel_worksheet.xlsx

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Order Quantity
Purchase Cost per unit
15,000
$ 16.00
Sales
Pessimistic
Likely
Optimistic
Order Quantity
Purchase Cost per unit
$
Order Quantity Total Cost
10,000
20,000
30,000
Pessimistic
Likely
Optimistic
10,000
20,000
30,000
18,000
18,000
18,000
$
$
$
288,000
288,000
288,000
Total Revenue @
$24.00
$ 240,000
$ 480,000
$ 720,000
20,000
$ 16.00
Pessimistic
Likely
Optimistic
Order Quantity Total Cost
10,000
20,000
30,000
20,000
20,000
20,000
$
$
$
320,000
320,000
320,000
Total Revenue @
$24.00
$ 240,000
$ 480,000
$ 720,000
24,000
$ 16.00
Sales
Pessimistic
Likely
Optimistic
Order Quantity
Purchase Cost per unit
240,000
240,000
240,000
Order Quantity Total Cost
Sales
Order Quantity
Purchase Cost per unit
$
$
$
18,000
16.00
Sales
Order Quantity
Purchase Cost per unit
15,000
15,000
15,000
Total Revenue @
$24.00
$ 240,000
$ 480,000
$ 720,000
$
Order Quantity Total Cost
10,000
20,000
30,000
24,000
24,000
24,000
$
$
$
384,000
384,000
384,000
Total Revenue @
$24.00
$ 240,000
$ 480,000
$ 720,000
28,000
16.00
Sales
Pessimistic
Likely
Optimistic
Order Quantity Total Cost
10,000
20,000
30,000
28,000
28,000
28,000
$
$
$
448,000
448,000
448,000
Total Revenue @
$24.00
$ 240,000
$ 480,000
$ 720,000
Total Revenue @
$5.00
$ 25,000
N/A
N/A
Profit
Total Revenue @
$5.00
$ 40,000
N/A
N/A
Profit
$
$
$
$
$
$
25,000
240,000
480,000
(8,000)
192,000
432,000
Total Revenue @
Profit
$5.00
$ 50,000 $ (30,000)
$ 160,000
$ 400,000
Total Revenue @
$5.00
$ 70,000
$ 20,000
N/A
Profit
Total Revenue @
$5.00
$ 90,000
$ 40,000
N/A
Profit
$
$
$
(74,000)
116,000
336,000
$ (118,000)
$
72,000
$ 272,000
Column1
Mean
Standard Error
Median
Mode
Standard Deviation
Sample Variance
Kurtosis
Skewness
Range
Minimum
Maximum
Sum
Count
Confidence Level(95.0%)
20000
5773.503
20000
#N/A
10000
1E+08
#DIV/0!
0
20000
10000
30000
60000
3
24841.38
10000
15000
18000
20000
24000
28000
30000
Column1
Mean
Standard Error
Median
Mode
Standard Deviation
Sample Variance
Kurtosis
Skewness
Range
Minimum
Maximum
Sum
Count
Confidence Level(95.0%)
20714.29
2696.685
20000
#N/A
7134.757
50904762
-0.95758
-0.13751
20000
10000
30000
145000
7
6598.55
Order Quantity
Purchase Cost per unit
$
16.00
Sales
Pessimistic
Likely
Optimistic
Order Quantity Total Cost
10,000
20,000
30,000
Total Revenue
@ $24.00 @ $5.00
Profit
1
SuperFun Toys Case Study
Team A
2
SuperFun Toys Case Study
SuperFun Toys, Inc., sells a variety of new and innovative children’s toys. Management
learned the pre-holiday season is the best time to introduce a new toy because many families use
this time to look for new ideas for December holiday gifts. When SuperFun discovers a new toy
with good market potential, it chooses an October market entry date. To get toys in its stores by
October, SuperFun places one-time orders with its manufacturers in June or July of each year.
Demand for children’s toys can be highly volatile. If a new toy catches on, a sense of
shortage in the marketplace often increases the demand to high levels and large profits can be
realized. However, new toys can also flop, leaving SuperFun stuck with high levels of inventory
that must be sold at reduced prices. The most important question the company faces is deciding
how many units of a new toy should be purchased to meet anticipated sales demand. If too few
are purchased, sales will be lost; if too many are purchased, profits will be reduced because of
low prices realized in clearance sales. SuperFun plans to introduce a new product called Weather
Teddy
This paper will use the sales forecaster’s prediction to describe a normal probability
distribution that can be used to approximate the demand distribution, sketch the distribution and
show its mean and standard deviation, compute the probability of a stock-out for the order
quantities suggested by members of the management team, compute the projected profit for the
order quantities suggested by the management team under three scenarios, and find the profit
potential the order quantity should have a 70% chance of meeting demand and only a 30%
chance of any stock- outs.
Normal Probability Distribution
3
Since SuperFun’s senior sales forecaster predicted an expected demand of 20,000 units
with a 95% probability that demand would be between 10,000 units and 30,000 units. Then
20,000 will be the mean and 5000 ((30000-20000)/2) would be the standard deviation. The Z
score would be 1.96 and as said above the probability would be .95. Where P(10000 < X <30000) =0.95. Since the Z score is 1.96, the means the standard deviation is (3000020000)/1.96 = 5102. This would indicate a normal distribution that would be used to approximate the demand distribution. Sketch the Distribution Somebody Probability of a Stock-Out Somebody Projected Profit The below table has computed the projected profit for the order quantities suggested by the management team under three scenarios: pessimistic in which sales are 10,000 units, most likely case in which sales are 20,000 units, and optimistic in which sales are 30,000 units. 4 Order Quantity Purchase Cost per unit $ 15,000 16.00 Sales Pessimistic Likely Optimistic Order Quantity Purchase Cost per unit $ Order Quantity Total Cost 10,000 20,000 30,000 Pessimistic Likely Optimistic $ Order Quantity Total Cost 10,000 20,000 30,000 Pessimistic Likely Optimistic $ Profit $ (8,000) $ 192,000 $ 432,000 10,000 20,000 30,000 20,000 $ 20,000 $ 20,000 $ Total Revenue @ $24.00 $5.00 320,000 $ 240,000 $ 50,000 320,000 $ 480,000 320,000 $ 720,000 Profit $ (30,000) $ 160,000 $ 400,000 24,000 16.00 Pessimistic Likely Optimistic $ 18,000 $ 18,000 $ 18,000 $ Total Revenue @ $24.00 $5.00 288,000 $ 240,000 $ 40,000 288,000 $ 480,000 N/A 288,000 $ 720,000 N/A Order Quantity Total Cost Sales Order Quantity Purchase Cost per unit $ 25,000 $ 240,000 $ 480,000 20,000 16.00 Sales Order Quantity Purchase Cost per unit Profit 18,000 16.00 Sales Order Quantity Purchase Cost per unit 15,000 $ 15,000 $ 15,000 $ Total Revenue @ $24.00 $5.00 240,000 $ 240,000 $ 25,000 240,000 $ 480,000 N/A 240,000 $ 720,000 N/A Order Quantity Total Cost 10,000 20,000 30,000 24,000 $ 24,000 $ 24,000 $ Total Revenue @ $24.00 $5.00 384,000 $ 240,000 $ 70,000 384,000 $ 480,000 $ 20,000 384,000 $ 720,000 N/A Profit $ (74,000) $ 116,000 $ 336,000 28,000 16.00 Sales Pessimistic Likely Optimistic Order Quantity Total Cost 10,000 20,000 30,000 28,000 $ 28,000 $ 28,000 $ Total Revenue @ $24.00 $5.00 448,000 $ 240,000 $ 90,000 448,000 $ 480,000 $ 40,000 448,000 $ 720,000 N/A Recommended Quantity and Profit (Mac) Blah blah blah Profit $ (118,000) $ 72,000 $ 272,000 5 Conclusion In conclusion this paper has described a normal probability distribution that can be used to approximate the demand distribution, sketched the distribution and show its mean and standard deviation, computed the probability of a stock-out for the order quantities suggested by members of the management team, computed the projected profit for the order quantities suggested by the management team under three scenarios, and found the profit potential the order quantity should have a 70% chance of meeting demand and only a 30% chance of any stock- outs. 6 References Black, K. (2017). Business Statistics: For Contemporary Decision Making. (9th Edition). Retrieved from the University of Phoenix Online eBook Collection. Investopedia, 2018. Retrieved from https://www.investopedia.com/ ... Our essay writing service fulfills every request with the highest level of urgency. attachment

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