Question
the following inventory data have been established for the adler corporation. 1. orders must be placed in multiple of 100 units. 2. annual sales are
the following inventory data have been established for the adler corporation. 1. orders must be placed in multiple of 100 units. 2. annual sales are 338,000 units 3. The purchase price per unit is $3 4) Carying cost is 20% of the purchase price of goods. 5) cost per order placed is $24 6) Desired safety stock is 14,000 units; this amount is on hand initially. 7) Two weeks are required for delivery a. what is the EOQ b. How many orders should the firm place each year? c. At which inventory level should a recorder be made? Hint: Recorder point = (safety stock + Weks to deliver * weekly usage) - goods in transit. d. calculate the total cost of ordering and carrying inventories if the order quantity is 4,000 units, 4,800 units, or 6,000 units. What are the total cost if the order quantity is the EOQ? e. What are the EOQ and inventory costs if the followeing were to occur?.....1. sales increase to 500,000 units 2. fixed order costs increase to $30; sales remain at 338,000 units. 3. Purchase price increases to $4; sales and fixed costs remain at the original values.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started