Question

Henry's computer store sells a printer for $200. demand is constant during the year, and annual demand is forecasted to be 600 units. holding cost is $20 per unit per year, whereas the cost of ordering is $60 per order. currently, the company is ordering 12 times per year (50 units each time). there are 250 working days per year, and the lead-time is 10 days. given the ordering policy of 50 units at a time, what is the total of the annual ordering and holding cost?

Answer 1

If they order 50 units, twelve times each year there're annual ordering and holding cost each year would be $20,640.