The Junior Achievers Club maintains an inventory of chocolate bars to meet its annual demand for 100,000 bars to service customers. Each bar costs $5.00, and cost per order is $100.00. Carrying costs have been identified as $1.50 per bar. Recently, the supplier has offered the company a 6.5% discount if orders are placed semi-annually.

Required:

What will be Achievers Club's total inventory costs if it utilizes EOQ? 

What will be the total inventory management costs if Achievers Club accepts the supplier discount?

Should Achievers Club accept the supplier discount?  Explain your answer by referencing the calculations?

Answer rating: 100% (QA)

SOLUTION To determine the Achievers Clubs total inventory costs we need to calculate the Economic Or... View the full answer