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What is the economic ordering quantity

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The Gentry Garden Center sells 90,000 bags of lawn fertilizer annually. The optimal safety stock (which is on hand initially) is 1,000 bags. Each bag costs the firm $1.50, inventory carrying costs are 20%, and the cost of placing an order with its supplier is $15. Please show work.

a. What is the Economic Ordering Quantity?

b. What is the maximum inventory of fertilizer?

c. What will be the firm's average inventory?

d. How often must the company order?

Reference no: EM132644801

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