An inventory item has a demand of 10,000 units per month. The cost of each unit is $6, and the interest on tied-up money is 10%. The average ordering cost is $250 per order. units (round your response to the nearest integer). a) What is the EOQ? b) What is the optimal number of orders per year? to the nearest integer) c) What is the optimal number of days between any two orders? your response to the nearest integer) d) What is the annual holding cost? $ nearest integer) orders (round your response e) What is the total annual cost of the inventory system? $ to the nearest integer) days (round per year (round your response to the (round your response

An inventory item has a demand of 10,000 units per month. The cost of each unit is $6, and the interest on tied-up money is 10%. The average ordering cost is $250 per order. units (round your response to the nearest integer). a) What is the EOQ? b) What is the optimal number of orders per year? to the nearest integer) c) What is the optimal number of days between any two orders? your response to the nearest integer) d) What is the annual holding cost? $ nearest integer) orders (round your response e) What is the total annual cost of the inventory system? $ to the nearest integer) days (round per year (round your response to the (round your response

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

An inventory item has a demand of 10,000 units per month. The cost of each unit is $6, and the
interest on tied-up money is 10%. The average ordering cost is $250 per order.
a) What is the EOQ?
units (round your response to the nearest integer).
b) What is the optimal number of orders per year?
to the nearest integer)
c) What is the optimal number of days between any two orders?
your response to the nearest integer)
d) What is the annual holding cost? $
nearest integer)
orders (round your response
e) What is the total annual cost of the inventory system? $
to the nearest integer)
days (round
per year (round your response to the
(round your response

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