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20-24 E00 for manufacturer. Sk8 Company produces skateboards and purchases 20,000 units of a wheel bearing each year at a cost of $1 per unit.
20-24 E00 for manufacturer. Sk8 Company produces skateboards and purchases 20,000 units of a wheel bearing each year at a cost of $1 per unit. Sk8 requires a 15% annual rate of return on investment. In addi tion, the relevant carrying cost (for insurance, materials handling, breakage, etc.) is $0.17 per unit per year The relevant ordering cost per purchase order is $38.40. 1. 2. 3. 4. Calculate Sk8's E0a for the wheel bearing Calculate Sk8's annual relevant ordering costs for the E0Q calculated in requirement 1 Calculate Sk8's annual relevant carrying costs for the E0Q calculated in requirement 1 Assume that demand is uniform throughout the year and known with certainty so there is no need for safety stocks. The purchase-order lead time is half a month. Calculate Sk8's reorder point for the wheel bearing
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