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A firm is faced with analyzing their total annual inventory costs for a particular product. A consultant has determined that they spend $30 placing each order. Further, the consultant helped determine that their annual carrying costs were 1/3 of the unit price of $60. Demand is fairly constant at 19,200 units per year. What are their total annual inventory costs for this product?
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Baker Mfg. Inc. wishes to compare its inventory turnover to those of industry leaders, who have turnover of about 13 times per year and 8% of their assets invested inventory.
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