Homework Answers
Annual Carrying cost = (Annual Demand * Unit cost) * Inventory carrying charge
= (112600* 44.55 $) * 20% = $ 1003266
Safety stock = 2 week worth of annual inventory = 112600/52 * 2 = 4330.7 rounded off to 4331 (Assuming 52 weeks in a year)
Inventory carrying charges for Safety stock is = (4331*$44.55) * 20% = $ 38589.21 ~ 38590
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