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A) Fast Speed Berhad is determined to cut costs and is anticipating introducing a just-in-time inventory system. It provides the followin information about its
A) Fast Speed Berhad is determined to cut costs and is anticipating introducing a just-in-time inventory system. It provides the followin information about its inventory and asks for a recommendation on how to control these inventory levels in the most optimal way. The following information is relevant: Orders have to be in multiples of 400 Annual usage is 1,000,000 units Use 50 weeks as a year in your calculations as the business shuts for 2 weeks during the year. Carrying cost 50% of the purchase price of the goods The purchase price is $40 per unit The ordering cost is $120 per order The safety stock limit is 8,000 units Delivery time is 1 week. Compute the Economic Ordering Quantity (EOQ) level. I IL Compute the average inventory level. [4 marks] [4 marks] Compute at what level of inventory should the firm place an order. [4 marks] B) finance. Explain the main elements of financial policy that a firm adopts for short-term [8 marks]
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