A computer equipment has 4 outlets. Currently each outlet manages its ordering independently. Demand at each outlet averages 10,000 units per week. Each unit costs $200, and the company has holding cost of 20% per annum. The fixed cost of each order (administration plus transportation) is $900. Assume 50 weeks in a year.

a) What is the annual demand at each outlets (Units/Year)?

b) What is the annual unit holding cost for a single outlet ($/unit/year)?

c) What is the quantity that would minimize annual inventory cost for each outlet ?

d) Using The EOQ, what is the average inventory the company holds across all 4 outlets (units)?

Answer rating: 100% (QA)

inventorycycle inventory6000 units across 4 outlets B af Annual demand at each outle... View the full answer