Annual demand of a manufacturing component used in company

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The annual demand of a manufacturing component used in company Butyl Saftey Inc. is 25,000 units. The cost of the component is $95 and holding costs (which includes storage, insurance, and cost of capital) are 39% of the unit cost. Each time an order is placed the company expects to incur costs, such as administrative and receiving, of $270. The supplier lead time is 13 days and the company operates with even production 365 days a year. Calculate the total annual holding costs. Choose the closest answer from the list below. 13,101 11,189 11,981 10,690.

Reference no: EM131648338

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