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Determine the most cost-effective order quantity

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Question - Indigo Ltd. Has the following quantity discount policy with its supplier Evanora Inc. Quantity Price per Case

1-299 cases $26.00

300-749 cases $24.86

750-1,499 cases $23.69

1,500 + cases $22.45

The economic order quantity is 161 cases and the annual usage is 25,921 cases. The ordering cost (K) is $6 per order and the carrying cost of inventory (H) is $12 per unit. Determine the most cost-effective order quantity.

Reference no: EM132929596

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