Question
Party Animals sells stuffed tigers. Products, Inc., manufactures many different stuffed animals. Party Animals orders 10,400 tigers per year, 200 per week, at $10 per
Party Animals sells stuffed tigers. Products, Inc., manufactures many different stuffed animals. Party Animals orders 10,400 tigers per year, 200 per week, at $10 per tiger. The manufacturer covers all shipping costs. Party Animals earns 12% on its cash investments. The purchase-order lead time is 3 weeks. Party Animals sells 210 tigers per week.
The following data are available (based on management's estimates):
Estimated ordering costs per purchase order $10
Estimated insurance, materials handling, breakage, and so on, per year $3
Actual ordering costs per order $15
What is the economic order quantity using the estimated amounts?
Group of answer choices
119 stuffed tigers
223 stuffed tigers
325 stuffed tigers
273 stuffed tigers
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