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EOQ, reorder point, and safety stock Alexis Company uses 907 units of a product per year on a continuous basis. The product has a fixed cost of $57 per order, and its carrying cost is $5 per unit per year It takes 5 days to receive a shipment after an order is placed, and the firm wishes to hold 10 days usage in inventory as a safety stock. a. Calculate the EOQ. b. Determine the average level of inventory. (Note: Use a 365-day year to calculate daily usage.) c. Determine the reorder point. d. Indicate which of the following variables change if the firm does not hold the safety stock: order cost, (5) economic order quantity 2) carrying cost, 3) total inventory cost, 4 reorder pont a. Alexis EOQ isunits. (Round to the nearest whole number) Enter your answer in the answer box and then click Check Answer parts remaining Clear All Check Answer

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Home nert Page Layout Formulas Data Review View dd-Ins s Cut ta copy. Σ AutoSum ー E ゴWrap Text B า 프 . Ej-., Δ. : r_一 逻锂函Merge & Center. $, % , 弼,8 conditional Format . Cell Insert Delete Format Sort &Find & 2 ClearFe Select Edting Format Painter Formatting, as Table w styles. ▼ ㆆ ▼ Clipboard Alignment Number Cells Formula Bar BH 4 BK CARRYING COST PURCHASE PRICE ANNUAL DEMAND ORDERING COST BJ BL BM BN BO BP BQ BR BT BU BV CP = NOT GIVEN 6 907 0- 57 8 EOQ= EOQ = SQRT( 2AO/CP)- SQRT(2*907*57/5)143.8040 10 144 (ROUNDED TO ZERO DECIMAL) 12 13 14 15 16 17 18 19 20 21 AVERAGE LEVEL OF INVENTORY EOQ/2(AX SAFETY STOCK DAYS/365) 144/2 (907 X 10/365)96.8493 97 (ROUNDED TO ZERO DECIMAL) REORDER POINT-(AX LEAD TIME DAYS/365) (A X SAFETY STOCK DAYS/365) (907 X 5/365)(907X10/365) 37.274 37 (ROUNDED TO ZERO DECIMAL) ORDERING COST & EOQ DOES NOT CHANGE CARRYING COST, INVENTORY COST & REORDER POINT WILL CHANGE LINE OF CREDIT miler Sheet3 BANKER ACCEPTANC0 erences: AR18 08-01-2019

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