Using the POQ Method of Ordering, Calculate the Total Cost

question 5

Multiple Choice

Using the POQ method of ordering, calculate the total cost of carrying and ordering inventory for the 6 week period shown. Use a POQ = 3 weeks for your answer.
$$\begin{array} { l c c c c c c } \text { Week } & 1 & 2 & 3 & 4 & 5 & 6 \\\text { Net requirements } & 60 & 40 & 10 & 50 & 20 & 30 \\\text { Planned order receipts } & & & & & & \\\text { Ending inventory } & & & & & &\end{array}$$
Cost to place an order = $100.00
Cost to carry inventory = $1.00 per unit per week
Annual demand = 1,500 units
Cost per unit = $200.00
Opening inventory = 0 units

• A) $140
• B) $280
• C) $340
• D) $400
• E) none of the above

---

Definitions:

Dichotic Listening

A psychological test in which different audio streams are presented simultaneously to each ear of a participant, used to study selective attention and the lateralization of brain function.

Shadow

An area of darkness created when an object blocks light from reaching a surface behind it.

To-Be-Attended-To

Refers to information or stimuli that require focus and cognitive processing in a given scenario.

Priming Effects

The influence that a prior stimulus exerts on subsequent cognitive processes, enhancing or inhibiting the response to a subsequent stimulus.