Answer the following question(s)using the information below:
Sandrington Ltd.operates a retail bicycle shop.Wheel covers are popular with customers.Sandrington purchases these covers for $48 per pair, and expects to sell 5,000 pairs per year.Ordering costs are estimated at $180 per order and relevant insurance handling etc.costs are estimated at $3.60 per month.The company has established a 14% annual return on investment.
-The EOQ model is designed to emphasize the tradeoff between which of the following factors?
A)carrying costs and ordering costs
B)purchasing costs and carrying costs
C)stockout costs and carrying costs
D)purchasing costs and ordering costs
E)stockout costs and ordering costs

Question

Quizplus · Accepted Answer

The EOQ (Economic Order Quantity) model is designed to minimize the total cost by balancing carrying costs (costs of holding inventory) and ordering costs (costs of placing orders).

Answer the Following Question(s)using the Information Below