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Unformatted text preview: Questionable Assumptions are: 1) Ordering Cost remains constant. 2) Demand rate is constant. 3) Lead time is fixed every time an order is placed. 4) Purchase price of product remains constant and no discounts are available. EOQ: Lilly’s Manufacturing needs fastener supplies to manufacture its products. The C company will need about 200,000 cases next year. The cost of storing cases is about $ $500 for a shipment. Determine the EOQ. Sheet1 Page 2 CFO estimates that the $0.90. The ordering cost is...
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- Spring '11
- Corporate Finance, CFO, questionable assumptions, 2*Annual Demand*Fixed Cost