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The manager of a local retail store is ordering a specialty item from a supplier in Toronto. The lead time is constant at five days.

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The manager of a local retail store is ordering a specialty item from a supplier in Toronto. The lead time is constant at five days. The store is open 300 days a year (50 weeks Monday-Saturday, with a two-week vacation). The average daily demand is 40 units, with a standard deviation of 7.6. (Assume that the distribution is approximately normal.) It costs $40 to place an order, and the annual holding cost is 30% of the inventory value. The supplier charges $8.00 per unit. Find the annual cost of this system, identifying and including all relevant components as well as the cost of goods. a. 96,802$ b. 96,000$ C. 97,517$

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