Aspects of the inventory policy

Reference no: EM13146536

Suppose that R&B Beverage Company has a soft drink product that shows a constant annual demand rate of 3600 cases. A case of the soft drink costs R&B $3. Ordering costs are $20 per order and holding costs are 25% of the value of the inventory. R&B has 250 working days per year, and the lead time is 5 days. Identify the following aspects of the inventory policy.

a. Economic order quantity

b. Reorder point

c. Cycle time

d. Total annual cost

Reference no: EM13146536

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