Using a computerized Inventory Management System, a Paint Supply Store franchise continuously monitors the inventory of all the paint located at each of their 15 stores and their distribution warehouse. The Paint Supply Store franchise sells an average of 60 gallons of Green Paint every week (for 52 weeks per year. Their current policy is that when the place an order for Green Paint from their supplier, they order 85 gallons at a price of $3.50 per gallon. The company does not hold Safety Stock It takes 2.25 weeks to receive an order from the supplier. Administrative costs for Ordering paint have been estimated $30 per order Holding Costs35% of the purchase price per gallon per year. What is the Total Annual Inventory Cost for the company's current policy? Reorder Point, ROP = dL + SS Service Level z Value 99.99% 3.719 d = Average Demand Rate per Time Period 99.90% 3.090 D = Demand Rate per Year 99.00% 2.326 L = Average Lead time (time periods) 95.00% 1.645 90.00% SS = Safety Stock = Z OL 1.282 85.00% 1.036 Odl Loa 80.00% 0.842 (Assuming Lead Time is constant as in Periodic review) 0 = Standard Deviation of the demand z = Number of Standard deviations corresponding to a service level Q = Order Quantity Average Inventory Level = Q/2 + SS H = Holding Cost Per Year Per Unit S = Ordering/Setup Cost Per Order Total Annual Inventory Cost = (%) + s + H(SS) - Standard Deviation of the demand z = Number of Standard de tions corresponding to a service level Q = Order Quantity Average Inventory Level = Q/2 + SS H = Holding Cost Per Year Per Unit S = Ordering/Setup Cost Per Order Total Annual Inventory Cost = (%) + + s + H(SS) Economic Order Quantity, EOQ = 1208 Time Between Orders = TBO = EOQ A. 51116.05 B. $1153.24 $794.68 D. $4681.95 E. $241.23