Fried Onions has total annual sales of 438,000 units,a carrying cost per unit of $2.67 per year,and restocking costs of $48 per order.What is the EOQ?

Question

Quizplus · Accepted Answer

The EOQ formula is:

√[(2DS)/H]

Where:
D = annual demand = 438,000 units
S = ordering cost = $48
H = carrying cost per unit = $2.67

Plugging in these values, we get:

√[(2 x 438,000 x 48)/2.67] = √4,868,352 ≈ 3,968 units

Therefore, the best choice is C) 3,968 units. This is the optimal order quantity that will minimize the total inventory costs for Fried Onions.

Fried Onions Has Total Annual Sales of 438,000 Units,a Carrying