Order lot size $2,000$

Requirements $($annual Forecast$)240,000$

Weight per Engnine $40$

Order processing cost $$200$

inventory carrying rate $20\%$ per year

Cost of working Capital $10\%$ per year

Profit Margin $15\%$

Price of Finished Goods $$10,500$

Back$-$order cost $$120$ per unit

Supplier $1$ Supplier $2$ Supplier $3$

unit price $$195$ $$190$ $$198$

Tooling costs $$12,000$ $$10,000$ $$15,000$

Terms $(2/10),($Net $30)(1/15),($Net $30)(1/10),($Net $20)$

Distance $120$ miles $100$ miles $150$ miles

Supplier Quality Rating $0\mathrm{.}020\mathrm{.}010\mathrm{.}02$

Supplier Delivery Rating $0\mathrm{.}010\mathrm{.}010\mathrm{.}02$

Truckload $($TL$=40000$ lbs$.)$: $\mathrm{.}95$ per ton$-$mile

less than truckload $($LTL$)$ : $1\mathrm{.}20$ per ton$-$mile

Per ton$-$mile $=2,000$ lbs$.$ per mile

Total engine cost $$46,800,000$ $$45,600,000$ $$47,520,000$

Tooling cost $$12,000$ $$10,000$ $$15,000$

Transportation Cost $10944009120001368000$

Ordering Cost $$24,000$ $$24,000$ $$24,000$

Quality Costs $$39,000\mathrm{.}0$ $$38,000\mathrm{.}0$ $$39,600\mathrm{.}0$

Delivery rating $936000\mathrm{.}00456000\mathrm{.}00950400\mathrm{.}00$

A$.$ Back order

B$.$ Lost Sales