Luxe Gowns Ltd. uses 1,800,000 meters of material each year. The firm orders the material at a cost of $3 per meter, plus fixed ordering costs of $120 per order. The firm's carrying cost is 18% of the inventory value at cost. Assume a 365-day year for this company. What is the firm's estimated EOQ (Economic Order Quantity)?

Luxe Gowns Ltd. uses 1,800,000 meters of material each year. The firm orders the material at a cost of $3 per meter, plus fixed ordering costs of $120 per order. The firm's carrying cost is 18% of the inventory value at cost. Assume a 365-day year for this company. What is the firm's estimated EOQ (Economic Order Quantity)?

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 11P: Negus Enterprises has an inventory conversion period of 50 days, an average collection period of 35...

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