The Miller Brewing. has developed a new type of Beer. The local distributor expects to increase his sales by 20% over the past year due to this new development. Last year's sales were $50,000 at a selling price of $100 per unit. A safety stock of 23 units has eliminated stock outs. The manager would like to cut costs as much as possible and comes to you for advice.

Warehouse space	$2.50/unit
Material Handling Expense	$1.50/unit
Insurance Premium	$1.00/unit
Total ordering cost	$100.00/per order

What is the economic order quantity?

How many orders will be made per year?

What is the total cost of this inventory decision?