Illustrate what is the yearly cost for ordering item x

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Q. Item X is a standard item stocked in a company's inventory of component parts. Each year the firm, on a random basis, uses about 1,800 of item X, which costs $25 each. Storage costs, which comprise insurance and cost of capital, amount to $10 per unit of average inventory. Every time an order is placed for more items X, it costs $14. Required: (a) Whenever item X is ordered, illustrate what should the order size be? (Round your answer to the nearest whole number.) Order size (b) Illustrate what is the Yearly cost for ordering item X? (Round your answer to 2 decimal places. Omit the "tiny_mce_markerquot; sign in your response.) Yearly cost for ordering item $ (c) Illustrate what is the Yearly cost for storing item X? (Round your answer to 2 decimal places. Omit the "tiny_mce_markerquot; sign in your response.) Yearly cost for storing item $

 

 

Reference no: EM1373888

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