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Assignment T&T is reevaluating its inventory control policy. Its daily demand for wooden boxes is steady at 180 a day for each of the 250
Assignment T&T is reevaluating its inventory control policy. Its daily demand for wooden boxes is steady at 180 a day for each of the 250 working days (50 weeks) of the year. The boxes are currently bought in batch of 750 from a supplier at $9. the cost of ordering is $110, regradless of the size. the stockholding cost expressed as a percentage of inventory value are 25% p.a. Required: a. Determin the economic order quantity and frequency of replinishment and the annual saving to be made by implementing these controls. b. Recommend weather or not it is worthwhile to make use of the local supplier's new quantity discount scheme which is as under: Qty Discount 0-2000 2000-6900 7000+
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