Question - TV Goods is a distributor of DVDs. DVD Mart is a local retail outlet which sells DVDs. DVD Mart purchases DVDs from TV Goods. Annual demand is 119964 packages of DVDs for 52 weeks. The purchase-order lead time is 3 weeks. The following cost data are available:
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Annual Demand
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119,964
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Relevant ordering costs per purchase order
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$16
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Carrying costs per package per year:
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$0.48
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Purchase-order lead time
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3 weeks
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Required: Compute the following. You must use the data above to compute the answers below using cell references and formulas.
1. Calculate the EOQ = Square root of 2DP/C?
2. Number of orders per year if EOQ used?
3. Calculate the annual ordering costs at EOQ?
4. Calculate the annual carrying costs at EOQ?
5. Calculate the number of units sold per week?
6. Calculate the reorder point?