Due to unprecedented growth during the year, Flowers by Kelly 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:
Identify whether increasing the size of inventory orders will increase, decrease, or have no effect on each of the following items.
________a.Average inventory
________b.Cost of goods sold
________c.Number of orders per year
________d.Total annual carrying costs
________e.Total annual carrying and ordering costs
________f.Total annual ordering costs

Question

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The Answer of Due to unprecedented growth during the year, Flowers by Kelly 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:
Identify whether increasing the size of inventory orders will increase, decrease, or have no effect on each of the following items.
________a.Average inventory
________b.Cost of goods sold
________c.Number of orders per year
________d.Total annual carrying costs
________e.Total annual carrying and ordering costs
________f.Total annual ordering costs

Due to Unprecedented Growth During the Year, Flowers by Kelly