A bakery buys sugar in 15-pound bags the bakery uses 5000, Operation Management

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A bakery buys sugar in 15-pound bags the bakery uses 5000

A bakery buys sugar in 15-pound bags. The bakery uses 5000 bags of sugar each year. Carrying costs are $20 per bag per year. Ordering costs are estimated at $5 per order. Assume that the bakery is open 250 days a year and its daily demand is estimated at 20 bags. It takes 5 days for each order of sugar to be filled. What is the maximum inventory held in a given EOQ cycle?

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Operation Management: A bakery buys sugar in 15-pound bags the bakery uses 5000

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