Global Manufacturing, Inc. currently begins each sales cycle with 294,900 units in stock. This stock is depleted at the end of each sales cycle and then reordered. The firm currently places 14 orders per year The carrying cost per unit is $2.009 per year and the fixed order cost is $13,850 per order. Assuming there is no shortage cost for this firm. The average cost of each unit of inventory is $58.17.

Beginning Inventory = 294,900 units

Ending Inventory = 0 Units

# Orders per year= 14 Orders

Carrying Cost/unit= $2.009 per year

Fixed Order Cost = $13,850 per order

Average Inventory Cost Per Unit = $58.17 per unit

Q* = square root (2T*F)/(CC)

a) What is the total carrying cost?

b) What is the restocking cost?

c) What is the total cost of current inventory policy? Answer for C is $462,427, this was confirmed by professor.

d) Calculate the economic order quantity?

f) What would the EOQ Inventory Balance (in dollars) be in 2019 if the firm switched to the EOQ Inventory Policy?

EOQ Inventory Balance = EOQ Units per order * Average inventory value per unit