Horizon Cellular manufactures cell phones for exclusive use in its communication network. Management must select a circuit board supplier for a new phone soon to be introduced to the market. The annual requirements are 50,000 units and Horizon’s plant operates 250 days per year. The data lot three suppliers are in the following table:

Which supplier and shipping quantity will provide the lowest total cost HorizonCellular?

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Annual Freight Costs Shipping Quantity Supplier 10,000 20,000 Price/Unit Annual Holding Cost/UnitLead Time (days)Annual Administrative Cost Abbott $10.000 $7,000 Baker$12.000 $9,000 Carpenter .000 $6,500 $30 $28 $31 $6.00 $5.60 $6.20 4 $10,000 $12.000 $9,000