### Ordering and carrying costs by using the EOQ

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##### Reference no: EM13845286

A produce distributor uses 720 packing crates a month, which it purchases at a cost of \$10 each. The manager has assigned an annual carrying cost of 35 percent of the purchase price per crate. Ordering costs are \$28. Currently the manager orders once a month.

How much could the firm save annually in ordering and carrying costs by using the EOQ? (Round intermediate calculations and final answer to 2 decimal places. Omit the "\$" sign in your response.)

Savings                 \$  per year

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