HighLife Corporation Has the Following Information: Average Demand = 30

question 30

Multiple Choice

HighLife Corporation has the following information: Average demand = 30 units per day Average lead time = 40 days
Item unit cost = $45 for orders of less than 400 units Item unit cost = $40 for orders of 400 units or more Ordering cost = $50
Inventory carrying cost = 15 percent The business year is 300 days.
Standard deviation of demand during lead time = 90 Desired service level = 95 percent
What is the TAC at $40/unit?(pick the number closest to the correct answer)

• A)$351,750
• B)$362,325
• C)$355,840
• D)$362,240

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Definitions:

Growth Rate

The rate at which a company's earnings or economy expands over a specific period.

Dividend

A part of a firm's profits shared with its stockholders, usually as cash payments or extra shares.

Rate of Return

The beneficial or adverse change in an investment's valuation over a particular duration, indicated as a percentage of the initial capital.