Question: 7 ) Paper Street Soap Company is having issues with its inventory control and ordering process. Tyler Durden, CEO, has asked you to determine Paper
Paper Street Soap Company is having issues with its inventory control and ordering process. Tyler Durden, CEO, has asked you to determine Paper Streets economic order quantity and reorder point. The firm uses units per year, pays $ per unit plus a $ setup fee for each order. Additionally, Paper Street prefers to maintain a unit safety stock and has a carrying cost for its inventory and orders typically take weeks to be delivered.
A What is Paper Street Soap Companys economic order quantity?
B At this EOQ what are the firms inventory carrying costs and its cost of ordering.
C At what inventory level should Wayne Enterprises reorder?
D What is the total cost of ordering and carrying inventories if the order quantity is units? What about units?
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