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Suppose that the R&B Beverage Company has a soft drink product that shows a constant annual demand rate of 3,600 cases. A case of the
Suppose that the R&B Beverage Company has a soft drink product that shows a constant annual demand rate of 3,600 cases. A case of the soft drink costs R&B $4. Ordering costs are $22 per order and holding costs are 23% of the value of the inventory. R&B has 250 working days per year, and the lead time is 5 days. Identify the following aspects of the inventory policy:
- Economic order quantity. If required, round your answer to two decimal places. Q* =
- Reorder point. If required, round your answer to the nearest whole number. r =
- Cycle time. If required, round your answer to two decimal places. T = days
- Total annual cost. If required, round your answer to two decimal places. TC = $
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