Answer the following question(s)using the information below:
The Wood Furniture Company produces a specialty wood furniture product, and has the following information available concerning its inventory items:
Annual demand is 10,000 packages per year.The purchase price per package is $16.
-What are the Wood Furniture Company annual relevant total costs at the economic order quantity?
A)$1,000
B)$1,500
C)$3,000
D)$3,500
E)$2,050

Question

Answer the following question(s)using the information below:
The Wood Furniture Company produces a specialty wood furniture product, and has the following information available concerning its inventory items:
  Annual demand is 10,000 packages per year.The purchase price per package is $16.
-What are the Wood Furniture Company annual relevant total costs at the economic order quantity?
A)$1,000 
B)$1,500 
C)$3,000 
D)$3,500 
E)$2,050

Quizplus · Accepted Answer

The economic order quantity (EOQ) minimizes the total relevant costs, which include ordering costs and holding costs. The given correct answer is $3,000, which represents the minimized total relevant costs at the EOQ.

Answer the Following Question(s)using the Information Below