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Larson Company sells cross-trainer shoes and wants to maintain a minimum safety stock of 50 pairs. The storage warehouse charges a carrying cost fee of
Larson Company sells cross-trainer shoes and wants to maintain a minimum safety stock of 50 pairs. The storage warehouse charges a carrying cost fee of $8 per pair and ordering costs amount to $20 per order. The company has correctly determined that the economic order quantity (EOQ) is 224 pairs. Compute the following amounts. (Round all final answers to the nearest full unit or dollar): A. The number of orders per year, assuming that the company sells 10,000 pairs of shoes per year. Answer: Answer 1 Question 18 orders. B. The average inventory balance. Answer: Answer 2 Question 18 pairs. Regardless of your answers for Parts A and B above, for Parts C and D, ASSUME that the number of orders per year was 45 and the average inventory balance is 160. C. Total ordering costs per year. Answer: $ Answer 3 Question 18 D. Total carrying costs per year. Answer: $ Answer 4 Question 18
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