John's 8-year-old Chevrolet Trail Blazer requires repairs estimated at $7,000 to make it road worthy again. His wife, Sherry, suggested that he should buy a 5-year-old used Jeep Grand Cherokee instead for $7,000 cash. Sherry estimated the following costs for the two cars: Trail Blazer Grand Cherokee Acquisition cost $29,000 $7,000 Repairs $7,000 Annual operating costs (Gas, maintenance, insurance) $2,480 $1,900 What should John do? What are his savings in the first year? ni ti A. Buy the Grand Cherokee: $580 B. Fix the Trail Blazer; $4,080 C. Fix the Trail Blazer; $7,147 D. Buy the Grand Cherokee; $8,900 Globe Inc. is a distributor of DVDs. DVD Mart is a local retail outlet which sells blank and recorded DVDs, DVD Mart purchases DVDs from Globe at $29 per DVD; DVDs are shipped in packages of 66. Globe pays all incoming freight, and DVD Mart does not inspect the DVDs due to Globe's reputation for high quality. Annual demand is 322,000 DVDs at a rate of 6,400 DVDs per week. DVD Mart earns 11% on its cash investments. The purchase - order lead time is one week. The following cost data are available: Relevant ordering costs per purchase order $116.50 Carrying costs per package per year: Relevant insurance, materials handling, $9.50 breakage, etc., per year What are the annual relevant ordering costs? . A. $7,735 B. $85,353 C. $11,183 D. $7,907