Question: Question 6 (13 marks) An Accountant must design inventory ordering systems for two new raw material items - A31 and B31. The company operates

Question 6 (13 marks) An Accountant must design inventory ordering systems for two new raw material items - A31 and B31. The company operates 50 weeks a year. The accountant has gathered the following information about the two items: Average weekly demand Unit purchase price Annual holding cost Ordering cost Lead time Current order size A31 60 units $20 20% on purchase price $80 per order 2 weeks 300 units 80 units B35 80 units $30 30% on purchase price $30 per order 2 weeks 250 units 90 units Maximum weekly demand Required: (i) Determine the optimal order quantity for material items - A31 and B35 using the economic order quantity (EOQ) model. Show your calculations. (4 marks)

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