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Zachary Thompson
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Office Supply House purchases 4,160 reams of paper per year, ordered in lots of 80 reams per week at $150 per ream. The vendor covers all shipping costs. Office Supply House is not required to inspect the shipment upon entry. Office Supply House earns 20% on its cash investments. The purchase order lead time is two weeks. The following cost data are available.
Relevant ordering costs per purchase order
Relevant insurance, materials handling, breakage, and so on, per year
What is the economic order quantity? Round to the nearest whole number. $53.75
$4.25
A.235 reams
B.324 reams
C.110 reams
D.114 reams
E.100 reams
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