Acme Industries has the following information for inventory management of their product. Cost: $1.40 per unit Annual demand: 160,000 units Average demand per week: 3,200 Required rate of return on investment: 8% Purchase order lead time: 21 days Relevant carrying costs per year (e.g. insurance, material handling etc.): $8,000 Relevant ordering costs per order: $95

Required:

a. Determine the economic order quantity (EOQ) for the product. b. Determine the total relevant costs (TRC) using EOQ c. Determine the number of orders placed each time period for the product. d. Determine the re-order point for the product. e. Determine the Total cost for the product. f. Briefly explain your calculations from a, b, and d above.