Explore BrainMass

Explore BrainMass

    carrying cost and restocking cost

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Auto Parts sells 1,200 electric parts per week and then reorders another 1,200 parts. If the relevant carrying cost per electric part is $4 and the fixed order cost is $750, what is the total carrying cost and the restocking cost, respectively?

    a) $2,400 and $39,900
    b) $3,200 and $33,800
    c) $2,400 and $39,000
    d) $3,400 and $30,000
    e) None of the above

    Company ABC has expected sales of 75,000 units this year, an ordering cost of $8 per order and carrying costs of $1.20 per unit. What is the EOQ?

    a) 900 units
    b) 1000 units
    c) 100 units
    d) 500 units
    e) None of the above

    © BrainMass Inc. brainmass.com June 4, 2020, 1:19 am ad1c9bdddf

    Solution Preview

    Solution is attached in docx and pdf format.


    a) The carrying costs are the average inventory ...

    Solution Summary

    This solution shows how to solve for two multiple choice questions that involve finding the total carrying cost, the restocking cost, and the EQQ.