Each year, Florida's Best Salad Dressing, Inc. (FBSD) purchases50,000 gallons of extra virgin olive...

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Accounting

Each year, Florida's Best Salad Dressing, Inc. (FBSD) purchases50,000 gallons of extra virgin olive oil. Ordering costs are $80.00per order, and the carrying cost, as a percentage of inventoryvalue is 80 percent. The purchase price to FBSD is $0.50 pergallon. FBSD’s management currently orders the EOQ each time anorder is placed. No safety stock is carried. The supplier is nowoffering a quantity discount of $0.03 per gallon if FBSD orders10,000 gallons at a time. What is the net benefit in dollars ifFBSD takes the discount? Enter your answer rounded to two decimalplaces.

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ANSWER EOQ 2Annual demandorder costannual carrying cost per unit05 250000800508005 447213 Total costs when EOQ 447213 will be ordering See Answer

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In: AccountingEach year, Florida's Best Salad Dressing, Inc. (FBSD) purchases50,000 gallons of extra virgin olive oil....Each year, Florida's Best Salad Dressing, Inc. (FBSD) purchases50,000 gallons of extra virgin olive oil. Ordering costs are $80.00per order, and the carrying cost, as a percentage of inventoryvalue is 80 percent. The purchase price to FBSD is $0.50 pergallon. FBSD’s management currently orders the EOQ each time anorder is placed. No safety stock is carried. The supplier is nowoffering a quantity discount of $0.03 per gallon if FBSD orders10,000 gallons at a time. What is the net benefit in dollars ifFBSD takes the discount? Enter your answer rounded to two decimalplaces.