It is Jan 1st and Great Distributing LLC has made a strategic decision on an annual contact to purchase a fixed monthly amount for the remained of the year because of a good price from its suppliers. The fixed monthly amount will be based on the EOQ.

1. Determine the EOQ given the following and create a monthly inventory projection to determine the estimated year end inventory given the following information:

• Assume Inv Loss is month end (so beginning plus new inventory)
• In July a sudden 10% demand increase occurs, but the new inventory purchase amount is already committed given Great Distributing's arrangement

Annual Demand		25000
Reord Cost		3000
CC		115
Starting Inv		1500
Inv Loss		3%

hint: remember to determine order frequency