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M&O gourmet shop sells a popular satay sauce that they have to order from Thailand. The satay sauce costs to the shop $10 a jar
M&O gourmet shop sells a popular satay sauce that they have to order from Thailand. The satay sauce costs to the shop $10 a jar and requires a six-month lead time for replenishment of stock. M80 use a 20% annual interest rate to compute holding costs and estimate that if a customer demands the satay sauce when it is out of stock, the loss- of-goodwill cost is $25 a jar. Bookkeeping expenses for placing an order amount to about$50
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