Your company makes computers. You are evaluating a quote from a potential new keyboard supplier, call them Supplier 1. The quote is as follows: Supplier 1 Price $12 Terms 1% 10 Net 40 Distance 750 Minimum order quantity 40,000 Weight 1 lbs Assume the following: Annual purchase volume (requirements - R) for keyboards is expected to be 600,000 units The price (C) is constant regardless of volume or order quantity Inventory holding rate (k) is 30% Working capital cost is 15% Your order quantity will always equal the minimum order quantity for the supplier Your freight rate is $2 per ton mile for a full truckload (40,000 lbs) and $2.5 for a less-than-truckload shipment The cost of an order (S) is $175 There are 360 days in a year. There are 2000 pounds/ton Tooling costs, quality costs, and late-delivery costs should be ignored. Q26 - What is the APC? 600,000 units $7,200,000 $600,000 $6,000,000 What is the AHC What is the AOC Which freight rate will you use What is the annual freight cost Which payment terms will you use What is the value of the payment terms that you will use when calculating TCO What is the Total Cost of Ownership TCO