Pаrt 1 Superiоr Cоrpоrаtion sells cаsual shoes with a demand of 750 pairs every 3 months. The store incurs an ordering cost of $75 and a holding cost of 20%. The supplier offers Superior Corporation the following price structure: Quantity Price 1 – 249 $40 250 – 349 $38 350 – 499 $36 Over 500 $34 Which order quantity results in the lowest cost? You need to support your answer with relevant calculations. Part 2 Superior Corporation sells an average of 25 pairs of dress shoes but can sell a maximum of 38 pairs. It takes 15 days for an order of dress shoes to arrive after being ordered. Required: What is the safety stock level? What is the reorder point?
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