Ranger Company purchases 17,280 units of Product Beta each year in lots of 864 unit's per-order. The cost of placing one order is $10, and the cost of carrying one unit of product in inventory for a year is $6.
Required:
1. How many orders for Beta does Ranger place per year?
2. What is the total ordering cost of Beta per year?
3. What is the total carrying cost of Beta per year?
4. What is the total cost of Ranger's inventory policy for Beta per year?
5. Is Ranger's order size equal to the EOQ amount? How could Ranger get closer to EOQ without actually figuring out the economic order quantity?