What is his annual inventory holding cost

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Reference no: EM132177469

Ray’s Satellite Emporium wishes to determine the best order size for its best selling satellite dishes. Ray has estimated the annual demand for this model at 1000 units. His cost to carry one unit is $100 per unit per year, and he has estimated each order costs $25 to place.

Using the EOQ model, how many should Ray order each time?

How many order does he place during the year?

What is his annual ordering cost?

What is his average inventory level?

What is his annual inventory holding cost?

If the company works 250 days per year, and the lead time for order delivery is 2 days, when should Ray’s Satellite Emporium place orders, i.e., what is the reorder point?

State the inventory policy clearly.

Reference no: EM132177469

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