How might different functional areas of an organization have different inventory management objectives? How would you meet management's challenge of balancing inventory? What tools and/or theoretical formulas would you utilize? Explain why. How do you differentiate cycle, safety, pipeline, and speculative inventory? Why do we need to do so? What is inventory carrying cost? Explain the primary components. What is the tradeoff between inventory ordering and carrying cost? What are stock-out costs? How should you calculate the cost?

Rolston music company is considering the sale of a new sound board used in recording studios. the new board would sell for $27,200, and the company expects to sell 1,570 per year. the company currently sells 2,070 units of its existing model per year. if the new model is introduced, sales of the existing model will fall to 1,890 units per year. the old board retails for $23,100. variable costs are 57 percent of sales, depreciation on the equipment to produce the new board will be $1,520,000 per year, and fixed costs are $1,420,000 per year. if the tax rate is 35 percent, what is the annual ocf for the project?