Question: Please type the answer by computer, so i can see it clearly, thank you!!! The shop estimates that the model Flying will sell 1,500 units
Please type the answer by computer, so i can see it clearly, thank you!!!
The shop estimates that the model "Flying" will sell 1,500 units per year. GIANT sells this model to the store for $500 per unit. The annual holding cost of each unit is projected to be 1% of the unit price, while the ordering cost is $20 per order for the retailer.
After evaluating this quantity discount plan, the shop must choose the best order quantity. The annual product cost will be factored into the overall annual cost by the retailer. GIANT consistently takes 25 working days to fulfill an order, while both the manufacturer and the store have 250 working days per year. The Economic Order Quantity (EOQ) model's assumptions are all met. When answering the following questions, show the units and steps of your computation. To one decimal place, round your answers.
Question:
1(a) Calculate the EOQ without discount and total annual cost.
1(b) Calculate the EOQ with 10% discount and total annual cost.
1(c) Calculate the EOQ with 20% discount and total annual cost.
1(d) Determine the best order quantity in terms of lowest total annual cost and the number of orders placed per year for the retailer if that order quantity is used.
1(e) Determine the reorder point (ROP).
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