Question
Lunas is a convenient store that purchases water from a bottling company in Ocho Rios. Lunas is opened every day except Easter Monday and Christmas
Lunas is a convenient store that purchases water from a bottling company in Ocho Rios. Lunas is opened every day except Easter Monday and Christmas Day. The demand for water is 200 bottles per day. Each bottle of water cost $100. The annual holding cost rate is 14%. Lunas ordering cost is $3,500 . The lead time for the delivery is 4 days on each order.
- How many bottles of water do you recommend that Lunas order every time it places an order. 4 Marks
- Determine the estimated holding cost; and ordering cost 4 Marks
- How much time will elapse between each order 4 Marks
- How many orders will be placed each year 3 Marks
- Determine the re-order point 3 Marks
- Advise Lunas on what will be their Total Annual Cost 2 Marks
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
