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Mr Shobanke has just been appointed as the new inventory manager for Glass and Tinted Manufacturers. On assumption, he was briefed that the company used
Mr Shobanke has just been appointed as the new inventory manager for Glass and Tinted Manufacturers. On assumption, he was briefed that the company used an average of 25,000 units of glass lining packs annually due to volume of customers the company maintain. For now, it is worrisome that whenever the company order glass lining packs, the suppliers charges $4.25 per pack for delivery and handling expenses regardless the quantity ordered The company current policy has been to order in quantities of 7000, 6000, 5000 and 4000 respectfully. However, the company is presently aware that it will cost her $2.50 per year to hold one glass lining pack in the inventory if she decides to order the same quantity at a time. Given this information, you are required to determine:
a) Shobankes total annual order cost and carrying cost?
b) Shobankes economic order quantity of the glass lining packs (EOQ)
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