6. High Tech, Inc. is a virtual store that stocks a variety of calculators in the warehouse. Customer orders are placed, the order is picked and packaged, and then shipped to the customer. A fixed order quantity inventory control system (FQS) helps monitor and control these SKU's. The following information is for one of the calculators that they stock, sell and ship. average demand 12.5 calculators per week lead time 3 weeks order cost $20/order Unit cost 8.00 carrying charge rate 0.15 number of weeks 52 weeks per year standard deviation of weekly demand 3.75 calculators SKU service level 90 percent current on hand inventory 35 calculators scheduled receipts 20 calculators backorders 2 calculators a. What is the Economic Order Quantity? b. What is the total annual order and inventory holding costs for the EOQ? c. What is the reorder point without safety stock? d. What is the reorder point with safety stock? e. Based on the previous information, should a fixed order quantity be placed, and if so, for how many calculators? Additional Requirements
