Thomas Corporation produces heating units. The following values apply for a part used in their production (purchased from external suppliers):

D = 2,880

Q = 120

P = $ 42

C = $ 4.20

Required:

1. For Thomas, calculate the ordering cost, the carrying cost, and the total cost associated with an order size of 120 units. If required, round your answers to the nearest cent.

Ordering cost	$fill in the blank 1
Carrying cost	fill in the blank 2
Total cost	$fill in the blank 3

2. Calculate the EOQ and its associated ordering cost, carrying cost, and total cost. If required, round your answers to the nearest cent.

EOQ	fill in the blank 4	units
Ordering cost	$fill in the blank 5
Carrying cost	fill in the blank 6
Total cost	$fill in the blank 7

3. What if Thomas enters into an exclusive supplier agreement with one supplier who will supply all of the demands with smaller, more frequent orders? Under this arrangement, the ordering cost is reduced to $0.42 per order.

Calculate the new EOQ.

fill in the blank 8 units