Due to unprecedented growth during the year Denise's Flowers decided to use some of its surplus cash to increase the size of several inventory order quantities that had been previously determined using an EOQ model.
Required:
For each of the following items tell whether the increase in order size caused an increase, a decrease, or no change.
-total annual ordering costs

Question

Quizplus · Accepted Answer

Increasing the order size reduces the number of orders needed per year, which decreases the total annual ordering costs.

Due to Unprecedented Growth During the Year Denise's Flowers Decided