Princeton GI Roofing Ltd wants to reduce its total inventory cost using the appropriate EOQ model. Currently, it orders 2170 thick gauge roofing sheets per batch. Annual demand is projected to be 43420 sheets. The ordering cost is Php 120. The average carrying cost is equivalent to 20% of the unit acquisition price of Php 400. Lead time is three days. Assume a 365 day year. Answer the following: g. Based on its current practice, how many times does it order in a year? Express your answer up to the hundredths place (two decimal places). h. Based on its current practice, what is its average inventory level? Express your answer up to the nearest integer or whole number. i. Based on its current practice, what is the company's total annual inventory cost? Express your answer up to the nearest centavo.
Princeton GI Roofing Ltd wants to reduce its total inventory cost using the appropriate EOQ model. Currently, it orders 2170 thick gauge roofing sheets per batch. Annual demand is projected to be 43420 sheets. The ordering cost is Php 120. The average carrying cost is equivalent to 20% of the unit acquisition price of Php 400. Lead time is three days. Assume a 365 day year.
Answer the following:
g. Based on its current practice, how many times does it order in a year? Express your answer up to the hundredths place (two decimal places).
h. Based on its current practice, what is its average inventory level? Express your answer up to the nearest integer or whole number.
i. Based on its current practice, what is the company's total annual inventory cost? Express your answer up to the nearest centavo.
Step by step
Solved in 2 steps
