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Alumina Ltd. produces a specialty aluminum product, and has the following information available concerning its inventory items: Relevant ordering costs per purchase order $470 Relevant
Alumina Ltd. produces a specialty aluminum product, and has the following information available concerning its inventory items:
Relevant ordering costs per purchase order $470
Relevant carrying costs per year for each package:
Required annual return on investment 13%
Required other costs per year $5
Annual demand is 33,000 packages per year. The purchase price per package is $49.
What are the relevant total costs at the economic order quantity?
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