Is it through its adjoining showroom. The store keeps several styles and brands of woodfloor in stock; however its biggest seller is the Rathdown floor. The store wants to determine the optimal order size and total inventory cost for this brand of 1. Piles of Tiles Floor Store in Greystones stocks wooden floors in its warehouse and woodfloor given an annual demand of 200,000 square metres of flooring, an annual holding cost of 9.375% of the inventory cost and an ordering cost of 15 per order Piles of Tiles Floor Store 16 The woodfloor manufacturer (outside supplier) charges per square metre. Timber Floor Store is considering adopting one of the following nventory models (a)Under the minimum total cost per annum. assumptions of the Basic EOQ model determine the EOQ and the (10 marks) (b) Assume now that shortages are allowed with a shortage cost per unit of2 per looring square metre. Determine the optimal order quantity and the minim total cost when allowing shortages (10 marks) (c) Suppose now that Piles of Tiles Floor Store has its own manufacturing facility in which it can produce the Rathdown flooring. The manufacturing facility can produce 2000 square metres of flooring per day (assume 300 days per annum) with the cost per square metre down to 15.95. The cost of setting up a flooring production run is assessed at 500 per batch run. Determine the optimal batch size and the minimum total cost for producing the woodflooring (14 marks) (d) The woodfloor manufacturer (the outside supplier) can offer a discount price of 15.90 per square metre to Piles of Tiles Floor Store if they order in batch sizes of 8000 square metres. Determine the annual total cost if Piles of Tiles Floor Store avails of the discount. (e) By considering the total costs (and annual savings) in parts (a) - (d) advise Piles of Tiles Floor Store on their ordering policy (8 marks (8 marks) (Total 50 marks)