Baked Bear orders ice cream toppings from their suppliers. Their most popular topping is chocolate chips. The chocolate chips get bought at a quantity of 4,000 every month of the year. Baked Bear gets the chocolate chips at a cost of $2.50 per bag. It costs $15 to place an order for chocolate chips. Baked Bear also incurs a cost of 15% the cost of each bag of chocolate chips every year in holding costs. It takes 5 days from the time an order is placed until it arrives at Baked Bear. Baked Bear is open 250 days a year.

Demand (D)Order Cost (S)Holding Cost (H)Days per yearLead Time (LT) Optimal Order Quantity (Q*)Number of replenishments in a year (N)Maximum Inventory (MI)Annual Holding Cost (HC) w/o SSROP w/ SSAnnual Holding Cost (HC) w/ SS