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Please solve this in 60minutss and please solve correct. i will give you thumbs up for correct solution. c. A retailer is specializing in selling
Please solve this in 60minutss and please solve correct. i will give you thumbs up for correct solution.
c. A retailer is specializing in selling performance enhancer food supplements and vitamin supplements. One of the products purchased by retailer for resale flavored Vitamin water by Searle Company. The retailer sells a fixed quantity of 200 bottle of Vitamin water per week. The estimated storage costs for a bottle of Vitamin water are $2.00 per annum per bottle. Delivery from retailer's existing suppliers takes two weeks and the purchase price per bottle delivered is $20. The current supplier charges a fixed $75 order processing charge for each order, regardless of the order size. Retailer has recently been approached by another supplier of Vitamin water with the following offer: (1) the cost of retailer per bottle will be $19 each. (2) There will be a fixed order processing charge of $250 regardless of order size. (3) Delivery time will be one week. (4) Retailer estimates that due to packaging differences, the storage cost per bottle will be $1.80 per annum per bottle. Required: i. Assuming the retailer continues to purchase from existing supplier, calculate economic order quantity, reorder level and total cost of stocking Vitamin water for one year. ii. Determine the economic order quantity if retailer changes to new supplier and determine if it would be financially viable to change to this new supplierStep by Step Solution
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