Sir, in this question while calculating annual ordering cost for 300 units why are we multiplying it with 80 and not 135?
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Firstly, we use the incorrect rate to find out the incorrect EOQ and then we use the correct ordering cost for finding out the correct EOQ.
Then, we compare the cost in both situations.
But when ordering cost is 135, then it should be 135 for whole answer and not just for calculating EOQ
Using 135, we only calculated the EOQ.
But 135 is not the actual cost incurred. It is Rs 80.