Calculate the annual holding cost-economic order quantity

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Reference no: EM13963998

The corner convenience store (CCS) gets its cool drinks delivered by a wholesaler at CCS, light cola sells at a rate of 40 six-packs per day. the shop is open 250 days per year. a six pack of light cola costs CCS $24. annual holding cost is 10% of the cost of the cola. It costs CCS $350 to place an order and this covers any delivery charge the wholesaler only sells in six packs.

a) determine the Economic order quantity (EOQ)

b) determine the average stock held

c) Calculate the annual holding cost

d) How many orders should be placed per year?

e) Calculate the annual ordering cost

f) what is the annual operating cost of the inventory system?

g) How much will CCS spend on buying light cola per year?

Reference no: EM13963998

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