# solution

Fred’s Fresh Fruits has annual demand for fruit pulp of 39,339 pounds. The purchasing price per pound is \$9.00. It takes five weeks to receive a delivery of pulp after ordering (Fred chose alliteration over accuracy when naming his company). It costs Fred \$51 to place each order and the annual carrying cost for Fred is 21 percent of the cost per pound.

a. What is the optimal order quantity of fruit pulp? Round intermediate calculations to 2 decimal places (e.g., \$20.61) and your answer to the nearest whole number.

b. How frequently should Fred order pulp? In other words, what is the time between orders (TBO)? Round intermediate calculations to 2 decimal places (e.g., \$20.61) and your answer to 2 decimal places (e.g., once every 4.13 months).

c. How many orders will Fred place during the next year? Round intermediate calculations to 2 decimal places (e.g., \$20.61) and your answer to 2 decimal places (e.g., 108.37 times).

e. What is the resulting annual holding cost when the optimal quantity (part a) is ordered? Round intermediate calculations to 2 decimal places (e.g., \$20.61) and your answer to the nearest whole number.

f. What is the resulting annual ordering cost when the optimal quantity (part a) is ordered? Round intermediate calculations to 2 decimal places (e.g., \$20.61) and your answer to the nearest whole number.