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ABC corporation uses 3,500 per year of a certain subassembly that has an annual holding cost of $35 per unit. Each order placed costs $140.
ABC corporation uses 3,500 per year of a certain subassembly that has an annual holding cost of $35 per unit. Each order placed costs $140. The company operates 250 days per year and it has found that an order must be placed with the supplier 6 working days before it can expect to receive that order. For this subassembly, calculate:
(a) the economic order quantity (Round answer to nearest whole number).
(b) the annual holding cost.
(c) the annual ordering cost.
(d) the reorder point.
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