The most important inventory item has annual holding costs of $330.00. One method of shipping this...
The most important inventory item has annual holding costs of $330.00. One method of shipping this item is 4 days faster than the other, but it is $1.15 more per unit.
How much more expensive is the slower method compared to the faster method? (Include the pennies in your answer)
Homework Answers
Per day holding cost = 330/365 = 0.904109589
4 day holding cost = 4*0.904109589 = 3.616438356
So slower method is expensive by (3.616438356-1.15) =
2.466438356 = $2.47 per unit (Rounded to nearest
penny)
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