Question

The manager of the Quick Stop Corner convenience store (which is open 360 days per year) sells four cases of Stein soda each day (1440 cases per year). Order costs are $8.00 per order. The lead time for an order is three days. Annual holding costs are equal to $57.60 per case. If the manager orders 16 cases each time she places an order, how many orders would she place in a year

Answer 1

Answer:

90 orders she would place in a year

Explanation:

The total annual cases of Stein soda that the manager buys are 1,440 cases. If she were to place 16 cases in a single order then we would divide the total  cases bought in a year by the cases bought in a single order to determine the number of orders the manager would place in a year. As shown below:

No. of orders placed in a year = Annual Total Cases bought / Cases purchased in single order

No. of orders placed in a year = 1,440 / 16

No. of orders placed in a year = 90 orders