Afirm that stocks lightbulbs gathers the following information: demand = 19,500 units per year, ordering cost = $25 per order, holding cost = $4 per unit per year. the firm wants to calculate the: a) eoq for the lightbulbs. b) annual holding costs for the lightbulbs. c) annual ordering costs for the lightbulbs.

Step-by-step explanation:

Demand = 19,500 units per year (D)

Ordering cost = $25 per order (O)

Holding cost = $4 per unit per year (C)

a)

   =

   =

   = 493.71044 ≈ 494

b) Annual holding cost =

                                      =

                                      = 4 × 247

                                      = 988

c) Annual ordering cost =

                                       =

                                       = 25 × 39.47

                                       = 986.75

AOQ = 494

Annual holding cost = 988

Annual ordering cost = 986.75