What is the annual total costs of post card inventory?

Business & Finance
Tutor: None Selected Time limit: 1 Day

Post Card Depot, an large retailer of post cards, orders 4,219,610 post cards per year from its manufacturer. Post Card Depot plans on ordering post card 6 times over the next year. Post Card Depot receives the same number of post cards each time it orders. The carrying cost is $0.17 per post card per year. The ordering cost is $426 per order.

What is the annual total costs of post card inventory?

(Round the answer to two decimal places).

Oct 6th, 2015

Hello!

Regardless of the number of orders, the total number of post cards ordered in a year is 4,219,610 and the cost is

4,219,610 * 0.17 = 717,333.7 ($).

The cost of 6 orders is

6 * 426 = 2556 ($).

The total cost is therefore

717,333.7 + 2556 = 719889.70 ($).

Please ask if something is unclear.
Oct 6th, 2015

hi, my professor came up with $63,333.81. I'm trying to figure out how she got this answer. 

Oct 6th, 2015

hmm... the only idea that her answer is more than 10 times smaller, maybe she computes fro one month? But even in that case I cannot get the same number...

Oct 6th, 2015

I will repost this question and see what others come up with. Thank you for responding though.

Oct 6th, 2015

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