(ii) Calculate the total annual ordering cost of XL-20 at the economic order quantity. Show your calculations. (2 marks)

(iii) Calculate the total annual carrying cost of XL-20 at the economic order quantity. Show your calculations. ( 2 marks)

(iv) Calculate total annual inventory costs of XL-20, including the purchase price. Show your calculations. ( 2 mark) (v) Determine if the company could save annual inventory costs by using the economic order quantity model. Show your calculations.

Question 6 (13 marks) An Accountant must design inventory ordering systems for two new raw material items - A31 and B31. The company operates 50 weeks a year. The accountant has gathered the following information about the two items: A31 B35 80 units 60 units Average weekly demand Unit purchase price $20 $30 Annual holding cost 20% on purchase 30% on purchase price price Ordering cost $80 per order $30 per order Lead time 2 weeks 2 weeks Current order size 300 units 80 units 250 units 90 units Maximum weekly demand Required: (i) Determine the optimal order quantity for material items - A31 and B35 using the economic order quantity (EOQ) model. Show your calculations. (4 marks)