For supply item MT, Bluesky Company has been ordering 150 units based on the

recommendation of the salesperson who calls on the company monthly. The company has hired a new purchasing agent, who wants to start using the economic-order-quantity method and its supporting decision elements. She has gathered the following information: 

Annual demand in units 300

Days used per year 300

Lead time, in days 20

Ordering costs $125

Annual unit carrying costs $25

Determine the EOQ, average inventory, orders per year, average daily demand, reorder point, annual ordering costs, and annual carrying costs.

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