EOQ reorder point, and safety stock. Alexis Company uses 877 units of a product per year on a continuous basis. The product has a fixed cost of $59 per order, and its carrying cost is $3 per unit per year. It takes 5 days to reeive a shipment after an order is placed. And the firm wishes to hold 10 days usage in inventory as a saftety 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: 1) order post, 2) carrying cost, 3) total inventroy cost, 4) reorder point, 5) economic quantity