Financial ManagementTU Board 2023
Nanglo bread company requires 100,000 bags of wheat per year for the production of bread. Each bag contains 50 kg of wheat and the purchase price per kg is Rs 25. It costs 10 percent for holding the…
6Nanglo bread company requires 100,000 bags of wheat per year for the production of bread. Each bag contains 50 kg of wheat and the purchase price per kg is Rs 25. It costs 10 percent for holding the inventory of wheat in stock per year and ordering costs per order is Rs 500. The firms require 9 days to receive the order placed and require maintain in 10 days for consumption in safety stock. a. What is the EOQ of wheat in kg? b. What is the total inventory cost of wheat including safety stock? c. What is re-order level?
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