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Please help me understand Part A. Correct anwers are shown in image. I am using EOQ = [(2 * demand * ordering cost) / holding
Please help me understand Part A. Correct anwers are shown in image. I am using EOQ = [(2 * demand * ordering cost) / holding cost per unit]:
EOQ = [(2 * 725 * $45) / $4]
EOQ (65300 / $4)
EOQ (16325)
EOQ 127.87, rounded to two decimal places = 128
128 = WRONG answer, can someone please explain why?
M. P. VanOyen Manufacturing has gone out on bid for a regulator component. Expected demand is 725 units per month. The item can purchased from either Allen Manufacturing or Baker Manufacturing. Their price lists are shown in the table. Ordering cost is $45, and a holding cost per unit is $4. a) What is the economic order quantity if price is not a consideration? units (round your response to the nearest whole number). b) Which supplier, based on all options with regard to discounts, should be used? c) What is the optimal order quantity and total annual cost of ordering, purchasing, and holding the component? The optimal order quantity is with a total cost of $ (round your responses to the nearest whole number)
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