Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Garden Variety Flower Shop uses 810 clay pots a month. The pots are purchased at $3.30 each. Annual carrying costs per pot are estimated to
Garden Variety Flower Shop uses 810 clay pots a month. The pots are purchased at $3.30 each. Annual carrying costs per pot are estimated to be 20 percent of cost, and ordering costs are $15 per order. The manager has been using an order size of 1,750 flower pots. a.What additional annual cost is the shop incurring by staying with this order size? (Round your optimal order quantity to the nearest whole number. Round all other intermediate calculations and your final answer to 2 decimal places. Omit the "$" sign in your response.) ces Additional annual cost b.Other than cost savings. what benefit would using the optimal order quantity yield (relative to the order size of 1750j? (Use the ounded order quantity from Part a. Round your final answer to the nearest whole percent. Omit the"%" sign in your response.) About 7% of the storage space would be needed
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started