meEOQ, reorder point, and safety stock Alexis Company uses 905 units of a product per year on a continuous basis. The product has a fixed cost of $49 per order,and its carrying cost is $5 per unit per year. It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days' usage in inventory as asafety stock.a. Calculate the EOQ.b. Determine the average level of inventory. (Note: Use a 365-day year to calculate daily usage.)c. Determine the reorder point.d. Indicate which of the following variables change if the firm does not hold the safety stock: (1) order cost, (2) carrying cost, (3) total inventory cost, (4) reorder point, (5)economic order quantity.entsuna. Alexis' EOQ isunits. (Round to the nearest whole number.)eTextedia Libraial Calculatr Resource Enter your answer in the answer box and then click Check Answer.ic Study3 partsremainingesClear AllCheck Answerunication Tools >OK10Type here to search5/1insert

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a. Alexis' EOQ is units. (Round to the nearest whole number.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 17P

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