You manage the perfume products for a major retail chain. Your company typically sells 5000 boxes...

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You manage the perfume products for a major retail chain. Your company typically sells 5000 boxes of perfume a year. Each box weighs 26 pounds. You know that it costs you $75 to make an order with the company that manufacturers the perfume. The perfume manufacturer has begun a new program to sell their perfume at a yearly price with quantity discounts available. They will sell the perfume at the following prices, priced non- inclusively, transportation costs included. 400 cases or less $35.00/box 401 to 800 cases $33.00/box 801 cases or more $30.50/box You know that your inventory carrying cost is 35%. You also like to buy your boxes in units of 100. Therefore, test every order size that is a multiple of 100 until you find the best price. 1. Based upon this information, determine the optimal purchase quantity and the annual cost for each alternative selected. (14 points) 2. What risks (at least 2) does a company face when they accept a quantity discounted price? (3 points) 3. What benefits (at least 2) does a company have when they accept a quantity discounted price? (3 points) The submission is to be typed. You manage the perfume products for a major retail chain. Your company typically sells 5000 boxes of perfume a year. Each box weighs 26 pounds. You know that it costs you $75 to make an order with the company that manufacturers the perfume. The perfume manufacturer has begun a new program to sell their perfume at a yearly price with quantity discounts available. They will sell the perfume at the following prices, priced non- inclusively, transportation costs included. 400 cases or less $35.00/box 401 to 800 cases $33.00/box 801 cases or more $30.50/box You know that your inventory carrying cost is 35%. You also like to buy your boxes in units of 100. Therefore, test every order size that is a multiple of 100 until you find the best price. 1. Based upon this information, determine the optimal purchase quantity and the annual cost for each alternative selected. (14 points) 2. What risks (at least 2) does a company face when they accept a quantity discounted price? (3 points) 3. What benefits (at least 2) does a company have when they accept a quantity discounted price? (3 points) The submission is to be typed. You manage the perfume products for a major retail chain. Your company typically sells 5000 boxes of perfume a year. Each box weighs 26 pounds. You know that it costs you $75 to make an order with the company that manufacturers the perfume. The perfume manufacturer has begun a new program to sell their perfume at a yearly price with quantity discounts available. They will sell the perfume at the following prices, priced non- inclusively, transportation costs included. 400 cases or less $35.00/box 401 to 800 cases $33.00/box 801 cases or more $30.50/box You know that your inventory carrying cost is 35%. You also like to buy your boxes in units of 100. Therefore, test every order size that is a multiple of 100 until you find the best price. 1. Based upon this information, determine the optimal purchase quantity and the annual cost for each alternative selected. (14 points) 2. What risks (at least 2) does a company face when they accept a quantity discounted price? (3 points) 3. What benefits (at least 2) does a company have when they accept a quantity discounted price? (3 points) The submission is to be typed. You manage the perfume products for a major retail chain. Your company typically sells 5000 boxes of perfume a year. Each box weighs 26 pounds. You know that it costs you $75 to make an order with the company that manufacturers the perfume. The perfume manufacturer has begun a new program to sell their perfume at a yearly price with quantity discounts available. They will sell the perfume at the following prices, priced non- inclusively, transportation costs included. 400 cases or less $35.00/box 401 to 800 cases $33.00/box 801 cases or more $30.50/box You know that your inventory carrying cost is 35%. You also like to buy your boxes in units of 100. Therefore, test every order size that is a multiple of 100 until you find the best price. 1. Based upon this information, determine the optimal purchase quantity and the annual cost for each alternative selected. (14 points) 2. What risks (at least 2) does a company face when they accept a quantity discounted price? (3 points) 3. What benefits (at least 2) does a company have when they accept a quantity discounted price? (3 points) The submission is to be typed.

Answer rating: 100% (QA)

QUESTION 1 For 400 cases or less the cost per box is 3500 the total cost of ordering 400 cases is or... View the full answer