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Help 5 EOQ The Purchasing Manager of Bailey Manufacturing purchases $200,000 of inventory every year Each piece of inventory costs $5.00 to buy from the
Help 5 EOQ The Purchasing Manager of Bailey Manufacturing purchases $200,000 of inventory every year Each piece of inventory costs $5.00 to buy from the supplier. In addition, the manager did an activity-based costing study and found that each order she places costs the company $125 and each item costs $2.50 per year in storage costs. Required: a. The Purchasing Manager currently places 4 oders per year. What is the total annual cost of placing orders? $[ What is the total annual cost of carrying inventory? ib. If she based her purchasing pattern on the Economic Order Quantity (EOC) model: What is the total annual cost of placing orders? What is the total annual cost of carrying inventory? $
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