Find the average monthly cost of the inventory

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Reference no: EM13962529

A shop that makes candles offers a scented candle, which has a monthly demand of 360 boxes. Candles can be produced at a rate of 36 boxes per day. The shop operates 20 days a month. Assume that demand is uniform throughout the month. Setup cost is $60 for a run, and holding cost is $2 per box on a monthly basis. Assume usage rate of 10 boxes per day. Find: a- The optimal production order quantity b- The average monthly cost of the inventory. c- The number of days in a run and days between runs.

Reference no: EM13962529

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