Calculate the ?rm economic order quantity for the cheese

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Reference no: EM133378904

Question: Mama Leone's Frozen Pizzas uses 59,000 pounds of cheese per year. Each pound costs $5.50. The ordering cost for the cheese is $1033.90 per order, and its carrying cost is $2.11 per pound per year. Calculate the ?rm's economic order quantity (EOQ) for the cheese. Mama Leone's operates 290 days per year and maintains a minimum inventory level of4 days' worth of cheese. Assuming that the lead time to receive orders of cheese is 2 clays, calculate the reorder point. The EOQ that minimizes the total inventory costs is pounds of cheese.

Reference no: EM133378904

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