Note: EOQ means Economic Order Quantity 1. Each year, Y Company purchases 20,000 units of an item that costs P 640 per unit.The cost of placing an order is P480, and the cost to hold the item in inventory forone year is P 150.a. Determine the EOQ.b. What is the average inventory level, assuming that the minimum inventory levelis zero?c. Determine the total annual ordering cost and the total annual holding cost forthe item if the EOQ is used.

Name: Note: EOQ means Economic Order Quantity 1. Each year, Y Company purcha
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Description: Note: EOQ means Economic Order Quantity 1. Each year, Y Company purchases 20,000 units of an item that costs P 640 per unit.The cost of placing an order is P480, and the cost to hold the item in inventory forone year is P 150.a. Determine the EOQ.b.

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Each year, Y Company purchases 20,000 units of an item that costs P 640 per unit. The cost of placing an order is P 480, and the cost to hold the item in inventory for one year is P 150. a. Determine the EOQ.

Each year, Y Company purchases 20,000 units of an item that costs P 640 per unit. The cost of placing an order is P 480, and the cost to hold the item in inventory for one year is P 150. a. Determine the EOQ.

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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