What is annual ordering cost if optimal ordering quantity

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Reference no: EM131664958

Be sure to always round inventory quantities (Q, R, SS, Imax) values up to the next integer for the final answers. All other values should be calculated based on the standard formulas without rounding them to integers and should be entered with one decimal place (e.g. average inventory, average number of orders, etc.).

Hiking Boots R Us is a local shoe store in Franklin. Annual demand for a popular hiking boot is 600 pairs per year, and Nairo Quintana, the owner of Hiking Boots R Us, has the habit of ordering 75 pairs of these hiking boots every time he places an order. Nairo estimates that the ordering cost is $25 and the cost of the hiking boots is $57.

a) What is the annual ordering cost if the optimal ordering quantity is 75?

b) What is the carrying cost (%) if the optimal ordering quantity is 75? (Enter real number- i.e. 12.5% should be entered as 12.5)

c) What is the annual holding cost if the optimal ordering quantity is 75?

d) What is the EOQ if carrying cost is 15%?

Reference no: EM131664958

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