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Suppose Big Box Office Supply (BBOS) purchases 100,000 office chairs every year. Ordering costs are $95.00...

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Finance

Suppose Big Box Office Supply (BBOS) purchases 100,000 officechairs every year. Ordering costs are $95.00 per order and carryingcosts are $5.75 per chair. What is BBOS’s total inventory cost peryear, including both carrying costs and ordering costs, if BBOSorders the EOQ of office chairs? Enter your answer rounded to twodecimal places.

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4.2 Ratings (821 Votes)
Solution Economic order quantity is calculated using the following formula 2AO C Where A Annual usage units O Ordering cost per order C Annual carrying cost of one unit In the given question as per the data given A Annual    See Answer
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Suppose Big Box Office Supply (BBOS) purchases 100,000 officechairs every year. Ordering costs are $95.00 per order and carryingcosts are $5.75 per chair. What is BBOS’s total inventory cost peryear, including both carrying costs and ordering costs, if BBOSorders the EOQ of office chairs? Enter your answer rounded to twodecimal places.

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