Question
As a part of its procurement strategy, a company is evaluating whether it should switch to a new supplier. A part of the evaluation
As a part of its procurement strategy, a company is evaluating whether it should switch to a new supplier. A part of the evaluation will focus on the price schedules that the two suppliers are offering. The annual demand for the product is 210,000 units. The cost of placing an order, independent of the supplier or the order quantity, is $220, and the carrying charge is estimated to be 12% of the item's price. Which supplier and what order quantity should the company use if its objective is to minimize its total related inventory costs? Click the icon to view the quantity discount schedule of supplier A. Click the icon to view the quantity discount schedule of supplier B. The company should order 12500 units from Supplier B number.) . (Enter your response rounded to the nearest whole The total annualized ordering costs for this optimal quantity is $ (Enter your response rounded to the nearest dollar.)
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