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Best Deal Depot purchases one model of computer at a wholesale cost of $300 per unit and resels it to end consumers. The annual demand for the company's product is 612,000 units. Ordering costs are $1.245 per order and caryying costs are $65 per computer, including $30 in the opportianty cost of holding inventory Required Requirement 1. Compute the optimal onder quanty using the EOQ model. Begin by selecting the formula used to calculaso EOQ. (D o Demand in units for one yeac, P= Ordering cost per purchase ordec, C=Carying cost of one unit in stock, Q= Any onter cuanofy) EOQ=C2D The cotimal erber quantify is (Round your finul ardwer to the nearest whole menber) Requirement 2. Compvie (a) the mumber of onsers per year and (b) the antuat relevart lotal cost of crderng and carying invertiony. (a) Compute the number of orders per yeat. The total relevant ordening costa we The tote reverant carpmg cous are Now find the revised total relevant carrying costs using the now carrying cost of $30. (Round your answer to the nearest whole dollar) The total reievant carrying costs are The rovised annyal reievant total cost of ordering and carrying inventory is (Round your antwer to the nearest whole dolar). Requirement 4. What is the cost impact on the company of excluding the opportunity cost of carryng inventory when making EOQ decisions? (Enter positive amounts onty. Round your antwer so the nearest whole dollar) Because managers wit chcose make the EOQ decision excluding the opportunty cost of carrying invenfory by using the carrying cost of $30, not S65, the cost to the company will be than it would be if managers wore evalualed based upon at carrying costs. Why do you think the compary cuerenty excludes the oppentunty cots of carring invertory when evaluating the manager performance? A. Bes Deal Depot probably does not include the oppontunty costs of carying inventory because it is tracked by the manutacturing system. 8. Beut Dear Depot probably does not inclube the oppontunty couts of carying inventsy bexause ti is not vached by the francial accounting system. C. Best Deal Depot probably does not include the opportunity costs of carying inventory because is is tracked by the distrbution syatem D. Best Deal Depot probeby does not indude the opportunity cous of carrying inventory because it is tracked by he human pesource systen. What could the company do to eneourage the manager to make docisions more congruent with the goel of reducro total itiventary costs? The corrpary could change the optimal decisions more congruent wth the goal of reducing total inventory costs Fven though tris would invelve an asstional caloulation, if encourage managen bo make 1. Compute the optimal order quantity using the EOQ model. 2. Compute (a) the number of orders per year and (b) the annual relevant total cost of ordering and carrying inventory. 3. Assume that when evaluating the manager, the company excludes the opportunity cost of carrying inventory. If the manager makes the EOQ decision excluding the opportunity cost of carrying inventory, the relevant carrying cost would be $30, not $65. How would this affect the EOQ amount and the actual annual relevant cost of ordering and carrying inventory? 4. What is the cost impact on the company of excluding the opportunity cost of carrying inventory when making EOQ decisions? Why do you think the company currently excludes the opportunity costs of carrying inventory when evaluating the manager's performance? What could the company do to encourage the manager to make decisions more congruent with the goal of reducing total inventory costs? (b) Compute the annual reievant total cost of ordering and carrying imventory (Round your answers to the nearest whole dollar) The total relevant cordening costs are The btal relevant carrying couts ace The annual relevant total cost of ordering and carrying inventory are Requirement 3. Assume that when evaluating the managec, the company excludes the opportunity cost of carrying inventory. If the manaper makes the EOQ decision excluding the opportunity cost Calculate the revised EOQ using the new carying cont of $30. (Round your answer to the nearest whole nurber) The optmal order quantily is Now find vie revised total relevant ordering costs using the now carrying cost of $30. Round your ansper to the nearett whole dollac) The total relevant ordering costs are Now fnd the revised total relevant ceryng costs using the new carying cost of 530 . Round your answer to the nearest whole dolar) The total relevant carrying costs are The revised artuas colevant lotal coot of ordering and carry imentiory a (flound your arswer ts the newrest whote deliar)