Reference no: EM132190570

C&A must decide whether to order or produce its tablet computer. Demand for the computer is 100 units per year. Holding costs per year are 5% of item cost. Ordering costs are $20 per order. C&A's production rate is 2,000 units per year. Set-up costs are $100 per production run. C&A pays a supplier $102 per computer but $100 per computer if they manufacture the computers themselves. Given the item cost information, should C&A produce or purchase the computers? Produce the computers because the total holding, ordering and item costs are 10308 Purchase the computers because the total holding, ordering and item costs are 10333 C&A is indifferent towards the two because their costs are identical Produce the computers because the total holding, setup and item costs are 10333 Purchase the computers because the total holding, ordering and item costs are 10308.