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Question - Red Dog Company predicts 320units of materials will be used during the year. Expected daily usage is 15 units, there is an expected lead time of 10 days , there is a safety stock of 200 units. Material is expected to cost $4/unit. Estimated that cost $25 to place each order. Annual cost is $1 /unit.
Required -
a. Compute the order point.
b. Determine most eco order quantity by use of the formula.
c. Determine the total cost of ordering and carrying at EOQ point.
What the minimum required rate of return is ? Net Operating Income - P25,000.00. Sales - P200,000.00. Average Operating Assets - P100,000.00
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