Bryson Carpet Mills Produces a Variety of Different Carpets

Multiple Choice

Bryson Carpet Mills produces a variety of different carpets.Changing from production of one carpet to another involves a setup cost of $500.One particular carpet costs $8/yard to produce.Annual demand for this style is 50,000 yards.Bryson Mills produces carpet 200 days per year.The production process is most efficient when 2,000 yards/day are produced.Inventory carrying cost is estimated at 20 percent annually.What should be the production order quantity?

A) 4,675 yards
B) 5,976 yards
C) 8,750 yards
D) 2,500 yards