Question: PLEASE SHOW STEP BY STEP WHEN DOING THE CALCULATIONS The GoodTaste Dairy has decided to begin selling milk in one-litre plastic bottles and to do

PLEASE SHOW STEP BY STEP WHEN DOING THE CALCULATIONS

The GoodTaste Dairy has decided to begin selling milk in one-litre plastic bottles and to do this (and ensure an adequate supply of empty bottles) they have decided to extrude (make) their own on site. The production of these new and yet-to-be-filled bottles is 280 cases (100 per case) per day, but their demand in the filling plant is only 240 cases per day. The setup cost to manufacture plastic bottles is $1000 and the plant operates for five days per week for 52 weeks of the year. The holding cost for one case of bottles for one year is $30. [ Choose the closest answer.] What is the total annual cost of setup and inventory holding if the plant decided to make 8,000 cases of bottles at one time? 61188.23 24942.86 17150.66 11,500.25 None of the above

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