RightTime (RT) Corporation operates a retail store featurin wristwatches. It maintains an EOQ decision model to make
Question:
RightTime (RT) Corporation operates a retail store featurin wristwatches. It maintains an EOQ decision model to make inventory decisions. Currently, it is considering inventory decisions for its TagMe wristwatches product line, which is very popular. Data for 2017 are as follows:
Each watch costs RT \($75\) and sells for \($200.\) The \($14\) carrying cost per watch per year consists of the required return on investment of \($9.00\)
plus \($5.00\) in relevant insurance, handling, and storage costs. The purchasing lead time is 10 days. RT is open 365 days a year.1. Calculate the EOQ for the TagMe product line.
2. Calculate the number of orders that will be placed each year.
3. Calculate the reorder point.
Step by Step Answer:
Horngrens Cost Accounting A Managerial Emphasis
ISBN: 9781292211541
16th Global Edition
Authors: Srikant Datar, Madhav Rajan