5. Assume Wyteboard Corp. markers uses 1,440,000 gallons of ink each year. Assume Palmer will order the ink at a rate of P2 per gallon plus a fixed cost of P100 per order. At cost, the firm's carrying cost is 20% of the inventory value. What is Wyteboard's minimum costs of ordering and holding inventory?

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter16: Supply Chains And Working Capital Management
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What is Wyteboard's minimum costs of ordering and holding inventory?

5. Assume Wyteboard Corp. markers uses 1,440,000 gallons of ink each year.
Assume Palmer will order the ink at a rate of P2 per gallon plus a fixed cost of
P100 per order. At cost, the firm's carrying cost is 20% of the inventory value.
What is Wyteboard's minimum costs of ordering and holding inventory?
Transcribed Image Text:5. Assume Wyteboard Corp. markers uses 1,440,000 gallons of ink each year. Assume Palmer will order the ink at a rate of P2 per gallon plus a fixed cost of P100 per order. At cost, the firm's carrying cost is 20% of the inventory value. What is Wyteboard's minimum costs of ordering and holding inventory?
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