Ottis, Inc., uses 636,740 plastic housing units each year in its production of paper shredders. The cost of placing an order is $28. The cost of holding one unit of inventory for one year is $13. Currently, Ottis places 158 orders of 4,030 plastic housing units per year.

1. Compute the annual ordering cost.

2. Compute the annual carrying cost.

3. Compute the cost of Ottis’s current inventory policy.

Answer rating: 100% (QA)

Solution 1 Annual ordering cost 636740 4030 28 158 28 4424 2 Annua... View the full answer