Compute what is the average inventory held during the year

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Reference no: EM133010442

Appliance for Less is a local appliance store. It costs this store $17.36 per unit annually for storage, insurance, etc., to hold microwave in their inventory. Sales this year are anticipated to be 779 units. Each order costs $71. The company is using Economic Order Quantity model in placing the orders.

Problem 1: What is the average inventory held during the year including safety stock if the store insists on a 6 days safety stock (assume 365 days a year)?

Reference no: EM133010442

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