Custom Computers, Inc. assembles custom home

Custom Computers, Inc. assembles custom home computer systems. The heat sinks needed are bought for $12 each and are ordered in quantities of 650 units. Annual demand is 5200 heat sinks, the annual inventory holding cost rate is $3 per unit, and the cost to place an order is estimated to be $50. Calculate the following:

Calculate the following:

(a) Average inventory level

units

(b) The number of orders placed per year

orders

(c) The total annual inventory holding cost $

(d) The total annual ordering cost $

(e) The total annual cost $

The new order quantity would be 1300 heat sinks. Recalculate Problem, parts (a) through (e), and compare results:

An order quantity of 650 units yields