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Determine the eoq-average inventory

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Reference no: EM131770829

For supply item HM, Bertha Company has been ordering 130 units based on the recommendation of the salesperson who calls on the company monthly. The company has hired a new purchasing agent, who wants to start using the economic-order-quantity method and its supporting decision elements. She has gathered the following information:

Annual demand in units 500

Days used per year 500

Lead time, in days 30

Ordering costs $125

Annual unit carrying costs $20

Determine the EOQ, average inventory, orders per year, average daily demand, reorder point, annual ordering costs, and annual carrying costs.

Reference no: EM131770829

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