Accounting.

Distribution/Supply Chain Management
December 26, 2020
Discuss and explain the managerial tool of management
December 26, 2020

Given the following information, formulate an inventory management system
The item demanded is 50 weeks a year
Item cost $12 Standard deviation of weekly
demand
Lead time
Service probability Order cost
$22500
Annual holding cost
25%
(%)
Annual demand
$26,000
Week per year
State the order quantity and reorder point 30/week a 1 week
90%
50 b Determine the annual holding and order costs
c If a price break of $60 per order was offered for purchase quantities of over 2,000, would you
take advantage of it? How much would you save annually?

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