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Globe IncIs a Distributor of DVDs

Question 21

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Globe Inc.is a distributor of DVDs.DVD Mart is a local retail outlet which sells blank and recorded DVDs.DVD Mart purchases DVDs from Globe at $25.00 per DVD;DVDs are shipped in packages of 63.Globe pays all incoming freight,and DVD Mart does not inspect the DVDs due to Globe's reputation for high quality.Annual demand is 314,000 DVDs at a rate of 6600 DVDs per week.DVD Mart earns 15% on its cash investments.The purchase-order lead time is one week.The following cost data are available:
Globe Inc.is a distributor of DVDs.DVD Mart is a local retail outlet which sells blank and recorded DVDs.DVD Mart purchases DVDs from Globe at $25.00 per DVD;DVDs are shipped in packages of 63.Globe pays all incoming freight,and DVD Mart does not inspect the DVDs due to Globe's reputation for high quality.Annual demand is 314,000 DVDs at a rate of 6600 DVDs per week.DVD Mart earns 15% on its cash investments.The purchase-order lead time is one week.The following cost data are available: What are the annual relevant ordering costs? A) $91,977 B) $11,949 C) $8449 D) $8353
What are the annual relevant ordering costs?


A) $91,977
B) $11,949
C) $8449
D) $8353

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