Due to Unprecedented Growth During the Year,Flowers by Kelly Decided

question 128

Essay

Due to unprecedented growth during the year,Flowers by Kelly decided to use some of its surplus cash to increase the size of several inventory order quantities that had been previously determined using an EOQ model.
Required:
Identify whether increasing the size of inventory orders will increase,decrease,or have no effect on each of the following items.
___a. Average inventory
___b. Cost of goods sold
___c. Number of orders per year
___d. Total annual carrying costs
___e. Total anunual carrying and ordering costs
___f. Total annual ordering costs

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Definitions:

Processing Line

A sequence of mechanical or chemical operations performed in order to prepare a product for market or further processing.

Hourly Wage

The rate of payment to a worker for each hour worked.

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A professional engineer who is involved in the design, construction, maintenance, and operation of power plants and equipment for generating electricity.

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Public holidays established by law, during which employees are entitled to have the day off with pay.