• Costco purchases cereal by the pallet. Each pallet contains 12 cartons. Each carton contains 6 boxes. Cereal sells for $4.00 per box. Projected monthly sales are $5,760. Carrying costs (storage, insurance, inspection, etc.) are $12.00 per carton per year. Placing an order costs $30.
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• Required: Compute EOQ. You can calculate the EOQ in boxes, cartons or pallets.

Answer rating: 100% (QA)

SOLUTION To calculate the Economic Order Quantity EOQ we need to consider the relevant costs and the ... View the full answer