question 3 please!

Vler, Reginald T Proper Lean Accounting pentru a C. on the basis CASE CASE 8. 1 LOW NAIL COMPANY After making some wise short-term investments at a race track, Chris Low had some additional cash to in- vent in a business. The most promising opportunity at the time was in building supplies , so Low bought a business che si les of one size of nail. The annual volume of na wa 2,000 kegs and they were sold to al customers in an even flow: Low was uncertain how many nails to order at any time. Initially, only two costs concerned him order processing costs, which were 560 2. Assume all conditions in question 1 hold, except to absorbing all or part of Low's order processing orders of 750 or more kegs of nails, the supplier will all the order processing costs; for orders between 25 749 kegs, the supplier will absorb half. What is also EOQ? (It might be useful to lay out all costs in the for this and later questions.) 3. Temporarily, ignore your work on question 2. Asume town Low's warehouse offers to rent Low space the arnage number of kegs Low will have in stock, ruhet than on the maximum number of kegs Low would need room for whenever a new shipment arrived. The stat charge per keg remains the same. Does this change the answer to question 1? If so, what is the new answet? 4. Take into account the answer to question 1 and the sup plier's new policy outlined in question 2 and the warehous new policy in question 3. Then determine Low's new ECO 5. Temporarily, ignore your work on questions 2, 3, and 4. Low's luck at the race track is over; he now must borrow money to finance his inventory of nails. Looking at the site ation outlined in question 1, assume that the wholesale com of nails is $40 per keg and that Low must pay interest at the rate of 1.5 percent per month on unsold inventory. What is his new EOQ? 6. Taking into account all the factors listed in questions 1,2,3 and 5, calculate Low's EOQ for kegs of nails. per order without regard to size, and warehousing costs, which were st per year per keg space. This meant that Low had to rent a constant amount of warehouse space for the year, and it had to be large enough to accommo- date an entire order when it arrived. Low was not wor ried about maintaining safety stocks, mainly because the ourward flow of goods was so even, Low bought his nails on a delivered basis QUESTIONS 1. Using the EOQ methods outlined in the text, how many Loss of nails should Low order at one time