771 (A) A garment store sells 500 shirts each month. Each shirt costs Rs 1,000 and the store has an annual holding cost

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771 A A Garment Store Sells 500 Shirts Each Month Each Shirt Costs Rs 1 000 And The Store Has An Annual Holding Cost 1 (51.5 KiB) Viewed 13 times

771 (A) A garment store sells 500 shirts each month. Each shirt costs Rs 1,000 and the store has an annual holding cost of 25 percent. The fixed cost of a replenishment order is Rs 1,200. The store currently places a replenishment order every month for 500 shirts. a) What is the annual holding and ordering cost? (b) On average, how long does a jacket spend in inventory? (c) If the store wants to minimize ordering and holding cost, what should be order size? Show all calculations. (B) Identify the major factors that affect cycle inventory and that affect Safety inventory. [9]