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ABC, Inc., produces a GPS device that is becoming popular in parts of Europe. When ABC produces one of these, a printed circuit board (PCB)
ABC, Inc., produces a GPS device that is becoming popular in parts of Europe. When ABC produces one of these, a printed circuit board (PCB) is used, and it is populated with several electronic components. ABC determines that it needs about 9,600 per year of this type of PCB. Demand is relatively constant throughout the year, and the ordering cost is about $40 per order; the holding cost is 25% of the price of each PCB. Two companies are competing to become the domina Fer of the PCBs, and both have now offered discounts, as shown in the following table. SUPPLIER A SUPPLIER B Quantity Price Quantity Price 1-199 $14.00 1-149 $14.10 200-499 13.80 150-349 13.90 500 or more 13.60 350 or more 13.70 If ABC wishes to minimize the total annual inventory cost and chooses Supplier B and decided to order 471 units. What would be the approximate annual inventory cost for that quantity? $137,005 133,142 134,108 135,074 None of the above
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