Answer Happy

Bradley Solutions and Alexander Limited are two well-established suppliers of inexpensive tools. Meanwhile, Weekend Projects is a national chain of retail outlets and wants to find a supplier for a particular tool set that promises to be a big seller. Expected annual sales are 100,000 units (D). Weekend's warehouses operate 50 weeks a year. Management collected data on the two suppliers, which are contained in the table below: Annual Freight Costs Shipping Quantity (0) Supplier 20,000 40,000 Price/unit(p) Annual Lead Holding Time Cost/Unit(H) (L)(wks) $1.5 4 $1.8 6 Annual Administrative Cost $20,000 $30,000 Bradley $30,000 $20,000 Alexander $25,000 $22,000 $6 $5 What is the annual inventory cost for Weekend Projects if the company chooses Bradley as the supplier and determines the shipping quantity at 20,000 units per shipment? $45,000 $27,000 $18,000 $36,000