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problem: For supply item XYZ, Andrews Company has been ordering 125 units based on the recommendation of the salesperson who calls on the company monthly. A new purchasing agent has been employed by the company who wants to start using the economic-order-quantity method & it's supporting decision elements. She has gathered the following data:

Annual demand in units

250

Days used per year

250

Lead time, in days

10

Ordering costs

$100

Annual unit carrying costs

$20

find out the EOQ, average inventory, orders per year, reorder point, annual ordering costs, average daily demand and annual carrying costs.

 

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M920323

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