Use the following description for the next TWO questions:

The American Snow$-$blower Company $($ASC$)$ is also trying to decide which of two suppliers to purchase engines from. ASC has agreed to cover the tooling cost for the supplier selected. The relevant information is provided below. Carry all calculations out to two decimal places.

Order lot size

$850$ units

Annual demand forecast

$12,750$ units

Engine weight

$20$ pounds

Order processing cost

$$350/$ order

Inventory carrying rate

$32\%$ per year

Supplier $1$

Supplier $2$

Unit Price $1$ to $999$ units $/$ order

$$200\mathrm{.}00$

$$205\mathrm{.}00$

Unit Price $1000$ to $2999$ units $/$ order

$$190\mathrm{.}00$

$$195\mathrm{.}00$

Unit Price $3000+$ units $/$ order

$$185\mathrm{.}00$

$$190\mathrm{.}00$

Tooling Cost

$$12,000$

$$6,500$

Distance

$125$ miles

$85$ miles

Supplier defect rate $(\%$ of engine cost$)$

$3\%$

$1\%$

Truckload $($TL $>=40,000$ lbs$.)$: $$0\mathrm{.}95$ per ton$-$mile

Less$-$than$-$truckload $($LTL$)$: $$1\mathrm{.}75$ per ton$-$mile

$($Note: per ton$-$mile $=2,000$ pounds per mile$)$