39) Harry's Sheds has ten different items in its finished : 1415267
39) Harry's Sheds has ten different items in its finished goods inventory. The average number of units held in inventory and the average unit cost are listed for each item. The firm uses an ABC system of inventory control.
(a)Which items should be considered to be in the A category of an ABC system of inventory?
(b)Which items should be considered to be in the B category of an ABC system of inventory?
40) Taizhou Products uses 800 units of a product per year on a continuous basis. The product has carrying costs of $50 per unit per year and order costs of $300 per order. It takes 30 days to receive a shipment after an order is placed and the firm requires a safety stock of 5 days usage in inventory.
(a)Calculate the economic order quantity (EOQ).
(b)Determine the reorder point. (Assume a 360-day year.)