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12) The following inventory, carrying, and storage costs are incurred by XYZ Inc. because of manufacturing aircraft parts: 1. Round lots of 100 units are
12) The following inventory, carrying, and storage costs are incurred by XYZ Inc. because of manufacturing aircraft parts: 1. Round lots of 100 units are the only way to place orders. 2. 250,000 units are used annually. (For calculations, use a year of 50 weeks.) 3. 10% of the purchase price is the carrying cost. 4. Each unit costs $10 for purchase. 5. Each order costs $100 to be placed. 6. A safety stock of 5,000 units is recommended. (Delivery-time stock is not included in this.) 7. One week is required for delivery. Determine the number of orders placed annually.
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