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AlekseyPX
1 year ago
10

demand for an item is 2,000 units per year. each order placed costs $25; the annual cost to carry items in inventory is $4 each.

in what quantities should the item be ordered?
Business
1 answer:
elixir [45]1 year ago
5 0

The quantity of the item that should be ordered is equal to 158 if its demand is 2,000 units per year.

The quantity of an item that should be ordered is linked to its demand and its carrying cost as well as the ordering cost. The quantity that should be ordered can be determined by using the economic order quantity formula. It may also be called as optimum lot size. The formula can be given as;

EOQ = √(2×ordering cost×annual demand ÷ holding cost)

As the annual demand for this item is 2000 units and each order cost $25 and the holding cost is $4, substituting these values in the equation as follows;

EOQ = √(2 × 25 × 2000 ÷ 4)

EOQ = √(100,000 ÷ 4)

EOQ = √25,000

EOQ = 158

Therefore, the quantity of the item that should be ordered is calculated to be 158.

To learn more about economic order quantity; click here:

brainly.com/question/26814787

#SPJ4

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There will be $405 million available to contestants in the following season as LIV golf grows to 14 events in 2023.

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4 0
1 year ago
Debt-to-equity ratio is:
babymother [125]
The D/E ratio indicates how much debt a company is using to finance its assets relative to the value of shareholders' equity
5 0
3 years ago
When a firm adopts new technology, it is customary for firms':
Anna35 [415]
I believe the answer is:

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6 0
3 years ago
Read 2 more answers
Palace Company has two service departments and two user departments. The number of employees in each department is:Personnel 10C
joja [24]

Answer:

$3,483.17

Explanation:

Calculation for the amount of cost allocated to the Cafeteria under the step method

Using this formula

Allocation to Cafeteria=[Cafeteria/(Cafeteria+Producing Department A+Producing Department B)]×Budgeted costs

Let plug in the formula

Allocation to Cafeteria=[25/(25 + 308 + 287)] x $72,450

Allocation to Cafeteria=(25/520)×$72,450

Allocation to Cafeteria=0.0480769231×$72,450

Allocation to Cafeteria=$3,483.17

Therefore the amount of cost allocated to the Cafeteria under the step method would be $3,483.17

8 0
2 years ago
Tanner-UNF Corporation acquired as a long-term investment $200 million of 7% bonds, dated July 1, on July 1, 2018. The market in
likoan [24]

Answer:

1. Prepare the journal entry to record Tanner-UNF’s investment in the bonds on July 1, 2018 and interest on December 31, 2018, at the effective (market) rate.

July 1, investment in UNF bonds

Dr Investment in bonds HTM 200,000,000

   Cr Cash 160,000,000

   Cr Discount on bonds 40,000,000

December 31, interest revenue from investment in bonds

Dr Cash 7,000,000

Dr Discount on bonds 200,000

   Cr Interest revenue 7,200,000

Discount on bonds = ($160,000,000 x 4.5%) - ($200,000,000 x 3.5%) = $7,200,000 - $7,000,000 = $200,000

2. Prepare any additional journal entry necessary for Tanner-UNF to report its investment in the December 31, 2018, balance sheet.

Investment in bonds HTM = $200,000,000 (face value) - $39,800,000 (discount on bonds) = $160,200,000

Changes in the market value of bonds held to maturity are not considered by the company.

4. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2019, for $310.0 million. Prepare the journal entry to record the sale.

Dr Cash 150,000,000

Dr Dr Discount on bonds 39,800,000

Dr Loss on investment in bonds HTM 10,200,000

   Cr Investment in bonds HTM 200,000,000

3 0
3 years ago
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