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1 (20 marks) Sue's toy store stocks toy trains. Recently the store has been given a quantity discount schedule for these trains as shown in
1 (20 marks) Sue's toy store stocks toy trains. Recently the store has been given a quantity discount schedule for these trains as shown in the table 1 below. The ordering cost is $49.00per order, annual demand is 5000 trains, and inventory carrying cost as a percentage of cost is 20percent. The normal cost for the train is $5.00 Discount Order quantity Unit number price 1 0-999 $5.00 2 1000-1999 $4.80 3. 2000 or more $4.75 Table 1 a) Determine order quantity for discount number 1 b) Determine order quantity for discount number 2 c) Determine order quantity for discount number 3. d) Compute total annual cost for discount number 1 e) Compute total annual cost for discount number 2 f) Compute total annual cost for discount number 3 g) Which discount band is the most favorable for Sue's store (Students should make the relevant adjustments where necessary)
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