Tom Bergman, owner and operator of the Earplug Superstore, i…
Tom Bergman, owner and operator of the Earplug Superstore, is reviewing the costs associated with the store’s best-selling hearing aid, the BZ15. The data available to Dr. Bergman concerning this device follow. Demand = 10 units/week Order cost = $3/order Holding cost = $1/unit/year The Earplug Superstore operates 52 weeks a year. Standard deviation of demand = 2 units/week Cycle service level = 90% (z = 1.65) Lead Time = 3 weeks If Tom decides to order at the economic order quantity, what is the total annual inventory costs (including the costs of holding inventory)? Round to two decimal places.