Assume that Palmer Executive Pens uses 1,440,000 gallons of ink each year. Further, assume that Palmer can order the ink at a cost of $2 per gallon plus fixed ordering costs of $100 per order. The firm's carrying cost is 20 percent of the inventory value, at cost. What is the EOQ? * O 21,456 13,563 26,833 O 43,987 30,040

Assume that Palmer Executive Pens uses 1,440,000 gallons of ink each year. Further, assume that Palmer can order the ink at a cost of $2 per gallon plus fixed ordering costs of $100 per order. The firm's carrying cost is 20 percent of the inventory value, at cost. What is the EOQ? * O 21,456 13,563 26,833 O 43,987 30,040

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 17P

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Question

1
Assume that Palmer Executive Pens uses 1,440,000 gallons of ink each
year. Further, assume that Palmer can order the ink at a cost of $2 per
gallon plus fixed ordering costs of $100 per order. The firm's carrying cost
is 20 percent of the inventory value, at cost. What is the EOQ? *
21,456
13,563
26,833
43,987
30,040

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EOQ? CALCULATE
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