Red Pine South is a hotel in Houston. As the hotel operations Manager, you need to keep tabs on many items, including a special customized bar soap for customers. The daily demand for the soap is 511 bars. You purchase the soap from a distributor for $3.68 per bar. The order a lead time is 5 days. Ordering cost is $35 per order and the inventory holding cost is $0.77 per bar per year. The hotel operates 365 days a year. What is the total annual inventory and purchase cost if you use use the optimal order quantity? Assume EOQ model is appropriate.
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