ACCT 434 Week 7 DQ 2 (Updated)

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ACCT 434 Week 7 DQ 2 (Updated)

20-26
EOQ, uncertainty, safety stock, reorder point. Stewart Corporation is a major automobile manufacturer. It purchases steering wheels from Coase Corporation. Annual demand is 10,400 steering wheels per year or 200 steering wheels per week. The ordering cost is $100 per order. The annual carrying cost is $13 per steering wheel. It currently takes 1.5 weeks to supply an order to the assembly plant.

  • 1. What is the optimal number of steering wheels that Stewart’s managers should order according to the EOQ model?

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