Landsborough Lawns Ltd, which produces lawn mowers, purchases 27,500 units of a rotor blade part each year at a cost of $35 per unit.Landsborough Lawns requires a 13% annual rate of return on investment.In addition, the relevant carrying cost (for insurance, materials handling, breakage and so on) is $9.50 per unit per year.The relevant ordering cost per purchase order is $125

Required:

1.Calculate Landsborough Lawns's EOQ for the rotor blade part.

2.Calculate Landsborough Lawns's annual relevant ordering cost for the EOQ calculated in requirement 1.

3.Calculate Landsborough Lawns's annual relevant carrying costs for the EOQ calculated in requirement 1.

4.Assume that demand is uniform throughout the year and known with certainty so that there is no need for safety stocks.The purchase order lead time is 1 week.Calculate Landsborough Lawns's reorder point for the rotor blade part.