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2. Herseal Trading, engaged in reselling school bags is having problems when it comes to managing its inventory quantities. Most of the time, Herseal would
2. Herseal Trading, engaged in reselling school bags is having problems when it comes to managing its inventory quantities. Most of the time, Herseal would run out of bags because she would order too few quantities. Herseal has an annual requirement of 24,000 bags as forecasted by its proprietress. Costs associated with carrying every unit of school bag would be P7. Herseal estimates that each order from her supplier will cost her P300. Herseal wonders if there would be a way to calculate her optimal inventory quantity. a. Compute for Herseal's economic order quantity. b. Compute for total order costs under the economic order quantity. c. Compute for total carrying costs under the economic order quantity. d. Compute for total inventory costs under the economic order quantity
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