Fresh Farm Produce Co. has examined transportation costs and found that shipping its fruits and vegetables by rail to distant markets would cost them only $89,000, while airfreight would cost $250,000. The costs of the actual fruits and vegetables are the same for each transportation mode. In the context of implementing the total cost approach, what should Fresh Farm Produce do?A. try to determine other physical distribution costs before deciding on whether to use airfreight.
B. immediately switch to rail to save money.
C. conduct marketing research to determine which fruits and vegetables customers want most.
D. immediately switch to airfreight because it is clearly a faster mode of transportation.
E. ship with airfreight and store the fruits and vegetables in warehouses.

Ardmore farm and seed has an inventory dilemma. they have been selling a brand of very popular insect spray for the past year. they have never really analyzed the costs incurred from ordering and holding the inventory and currently fave a large stock of the insecticide in the warehouse. they estimate that it costs $25 to place an order, and it costs $0.25 per gallon to hold the spray. the annual requirements total 80,000 gallons for a 365 day year.a. assuming that 10,000 gallons are ordered each time an order is placed, estimate the annual inventory costs.b. calculate the eoq.c. given the eoq calculated in part b., how many orders should be placed and what is the average inventory balance? d. if it takes seven days to receive an order from suppliers, at what inventory level should ardmore place another order?