How many days will elapse between two consecutive orders

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Reference no: EM132111729

A hover board retailer enjoys a constant demand of exactly 20 customers every week. The retailer is open 5 days a week for 50 weeks per year. The cost of ordering and receiving shipments is $20 per order. Their accounting department estimates that annual carrying costs are $4.00 per unit. The supplier lead time for shipments of new products is 5 days. Each order is received from the supplier in a single delivery.

1. What quantity should the retailer order with each order?

2. How many times per year will the store order?

3. How many days will elapse between two consecutive orders?

4. What is the reorder point if the company wishes to carry a safety stock of 15 units?

5. What is the store’s minimum total annual cost of placing orders and carrying inventory?

Reference no: EM132111729

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