An automotive supply store sells a product that has a demand of 400 units per month. Its supplier charges an ordering cost of $60 per order and $25 per unit with a 20% discount for orders of 250 units or higher. The store incurs a 20% annual holding cost. What is the store’s total annual cost (purchasing, ordering, and holding) if it orders at a quantity of 300 units? a. $121,560 b. $96,000 c. $120,000 d. $97,560

An automotive supply store sells a product that has a demand of 400 units per month. Its supplier charges an ordering cost of $60 per order and $25 per unit with a 20% discount for orders of 250 units or higher. The store incurs a 20% annual holding cost. What is the store’s total annual cost (purchasing, ordering, and holding) if it orders at a quantity of 300 units? a. $121,560 b. $96,000 c. $120,000 d. $97,560

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 10MC

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