Qauntitative Analysis for Mgmt

Your company uses 1,500 per year of a certain subassembly that has an annual holding cost of $45 per unit. Each order placed costs $150. The company operates 300 days per year and has found that an order must be placed with the supplier 6 working days before it can expect to receive that order. For this subassembly, find the following:
A. The economic order quantity 1500/45 = 33.3
B. The annual holding cost 33.3/2 = 16.50 (45) = 742.50
C. The annual ordering cost 1500/33.3 = 45.04 (742.50) =33,442.2
D. The reorder point 1500/300 = 5(6) 30

Again, I am kinder lost.

asked by JeannieC

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