Hafiz Ptd Ltd sells 8,500 Maclaren buggies per year. Based on the company's policy, a safety stock of 5% from yearly sales is to be maintained. The cost of carrying a Maclaren buggy is RM15 per unit per year. It costs RM78 to prepare and receive an order. The delivery time is 11 days. The inventory planning period is one year. Assume 360-days per year. 

Requirement

i) Determine optimal EOQ.

 ii) What is the average inventory?

 iii) What is the number of orders?

 iv) What is the reorder point?

 v) What is the company's total inventory cost for the year?

Answer rating: 100% (QA)

i Economic Order Quantity EOQ model 2DSH D is the demand in units per year S is the ordering cost pe... View the full answer