Rock Bottom Carpets sells 5,600 carpets a year at an average price per carpet of $1,490.The carrying cost per unit is $22.37.The company orders 500 carpets at a time and has a fixed order cost of $69 per order.The carpets are sold out before they are restocked.What is the economic order quantity?
A)147 carpets
B)166 carpets
C)186 carpets
D)315 carpets
E)372 carpets

Question

Quizplus · Accepted Answer

EOQ = √[(2 × 5,600 × $69)/$22.37] = 186 carpets

Rock Bottom Carpets Sells 5,600 Carpets a Year at an Average