Warehouse Sports,a large box store retailer of athletic shoes,orders 200,000 shoes per year from its manufacturer.If Warehouse Sports orders 10,000 shoes in each order,and spends $10,000 in total annual ordering costs,what is the cost of ordering and delivery per order?

Question

Quizplus · Accepted Answer

The total annual ordering cost is $10,000 for 200,000 shoes. With 10,000 shoes per order, there are 20 orders per year. Therefore, the cost per order is $10,000 / 20 = $500.

Warehouse Sports,a Large Box Store Retailer of Athletic Shoes,orders 200,000