Xander Company anticipates that usage of Component T will be 100 units daily, which equates to...

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Xander Company anticipates that usage of Component T will be 100 units daily, which equates to around 25,000 for the year. The material is expected to cost $5 per unit. Once an order is placed with its vendor, it takes five days to receive the goods, and the cost of placing each order is $50. As a result, Xander keeps 1,000 units on hand to avoid stockouts. The carrying cost associated with each unit is $10. a. b. Compute the order point. Determine the most economical order quantity. Xander Company anticipates that usage of Component T will be 100 units daily, which equates to around 25,000 for the year. The material is expected to cost $5 per unit. Once an order is placed with its vendor, it takes five days to receive the goods, and the cost of placing each order is $50. As a result, Xander keeps 1,000 units on hand to avoid stockouts. The carrying cost associated with each unit is $10. a. b. Compute the order point. Determine the most economical order quantity.

Answer rating: 100% (QA)

Answer a Order Point The order point represents the inventory level at which a new order should be p... View the full answer