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EOQ, average inventory, orders per year, average daily demand.
For supply item ABC, Andrews Company has been ordering 125 units based on the recommendation of the salesperson who calls on the company monthly. A new purchasing agent has been hired by the company who wants to start using the economic-order-quantity method and it's supporting decision elements. She has gathered the following information:
Annual demand in units
250
Days used per year
Lead time, in days
10
Ordering costs
$100
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
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