Annual holding cost
Frederick's Farm Factory (FFF) currently marintains an average inventory valued at $3,400,000. The company estimates its capital cost at 10 percent, its storage cost at 4.5 percent, and its risk cost at 10 percent.
(a) Evaluate the annual holding cost rate for FFF
Annual holding cost rate = % (Round your answer to 1 decimal place.)
(b) Evaluate the total annual holding costs for FFF
Total annual holding costs = $.