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Minty Airfresheners Ltd. maintains an inventory of bottles with chemical disinfectants to meet its annual demand for 84,200 bottles to service restrooms. Each package costs
Minty Airfresheners Ltd. maintains an inventory of bottles with chemical disinfectants to meet its annual demand for 84,200 bottles to service restrooms. Each package costs $4.88, and the order cost is $119.25 per order. Carrying costs have been identified as $1.63 per package. Minty Airfresheners bases its orders on the economic ordering quantity. Recently, the wholesaler of the bottles, in an attempt to shift the inventory burden to Minty Airfresheners, has offered a 15 percent discount if orders are placed quarterly. |
Should the present ordering policy of Minty Airfresheners be changed? | |||||
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