GreenvilleRunning provides all types of running shoes for customers who are in love with their

high$-$end running gear. The products are high quality, with a price tag to match. As the logistics

manager, however, you realize that it is still important to keep costs under control, so as to

maximize the profit potential for these products. Therefore, you conduct some analysis related to

inventory management.

NOTE: Read the questions and all information below carefully as there are many details

contained in each question set$-$up$.$

Total Cost$-$Inventory Carrying Costs vs Ordering Costs:

One of items that GreenvilleRunning sells is their famous ECUShoes. What is the total cost

per year for order cost and carrying cost for this item, given the following data? Cost per Unit $$150$

Average Inventory $($units$)2,000$

Cost per Order $$2,500$

Carrying Cost $5\%$

Number of orders per year $13$

Calculate the following:

a$)$ Total Annual Order Cost

b$)$ Total Annual Inventory Carrying Cost

c$)$ Total Cost

d$)$ Is GreenvilleRunning currently operating at

the EOQ with the ECUShoes? Why or

why not?

Using the cost information $($cost per order, cost per unit, carrying cost percentage$)$ from Question $1,$ fill in the empty boxes. Which order period optimizes the system costs?

$\backslash$table$[[\backslash$table$[[$Order$],[$Period$]],\backslash$table$[[$#$],[$Orders$],[$per$],[$Year$]],\backslash$table$[[$Average$],[$Inventory$],[($Units$)]],\backslash$table$[[$Total Annual$],[$Order$],[$Cost$]],\backslash$table$[[$Total Annual$],[$Inventory Carrying$],[$Cost$]],\backslash$table$[[$Total Annual$],[$Cost$]]],[2$ weeks,$26,1,000,,,],[1$ month,$12,2,167,,,],[1\mathrm{.}5$ months,$8,3,250,,,],[2$ months,$6,4,333,,,],[3$ months,$4,6,500,,,],[4$ months,$3,8,667,,,],[6$ months,$2,13,000,,,]]$