Custom computers inc assembles custom home computers annual, Financial Management

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Custom computers inc assembles custom home computers annual

Custom Computers, Inc. assembles custom home computers. Annual demand for heat sinks is 5,200 units, the annual inventory cost rate is $3 per unit, and the cost to place an order is estimated to be $50. Lead time is 2 weeks.

A) What is the economic order quantity for the heat sinks?

B) What is the total annual cost (ordering + holding) of this plan?

C) What is the reorder point for this plan?

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