A company uses the Economic Order Quantity (EOQ) model to establish reorder quantities. The following information relates to the forthcoming period: Order costs = $25 per order Holding costs = 10% of purchase price Annual demand = 20,000 units Purchase price = $40 per unit EOQ = 500 units No safety inventory is held. What are the total annual costs of inventory (i.e. the total purchase cost plus total order cost plus total holding cost)?
A、$22,000
B、$33,500
C、$802,000
D、$803,000
A、$22,000
B、$33,500
C、$802,000
D、$803,000
【参考答案及解析】
$ Purchase costs (20,000 units x $40) 800,000 Order costs (20,000/500 orders x $25/order) 1,000 Holding costs (500/2 average units x$4/unit) 1,000 Total costs 802,000
$ Purchase costs (20,000 units x $40) 800,000 Order costs (20,000/500 orders x $25/order) 1,000 Holding costs (500/2 average units x$4/unit) 1,000 Total costs 802,000