1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
vladimir2022 [97]
3 years ago
12

A producer of electronic parts wants to take account of both production rate and demand rate in deciding on its lot sizes. A par

ticular $50 part can be produced at a rate of 100 units per day, and the demand rate is 20 units per day. Assuming there are 300 days in a year. The firm uses a carrying charge of 24% a year, and the setup cost is $200 each time the part is produced.
Required:
a. What lot size should be produced?b. If the production rate is ignored, what would the lot size be? How much does this smaller lot size cost the firm on an annual basis?
Business
1 answer:
Len [333]3 years ago
8 0

Answer:

a) Optimal lot size = 1,118.03

b) Annual total cost = $46.51

Explanation:

As per the data given in the question,

a) Daily holding cost = $50 × 24% ÷ 300 = $0.04

Optimal lot size = Sqrt (2 × Demand rate × Setup cost ÷ (Daily holding cost × ( 1 - Demand rate ÷ Production cost)))

= Sqrt(2 × 100 × $200 ÷ ($0.04 × (1 - 20 ÷ 100)))

= $1,118.03

b) If the production rate is ignored then optimal lot size :

= Sqrt (2 × 20 × $200 ÷ 1)

= 89.44

Annual total cost = Setup cost+ holding cost

= (Demand rate ÷ Optimal lot size) × Setup cost + (Optimal lot size ÷ 2) × holding cost

= (20 ÷ 89.44) × $200 + 89.44 ÷ 2 ×$0.04

= $44.72 +  $1.79

= $46.51

You might be interested in
On an organization's board of directors, Multiple Choice inside directors must work for the organization and outside directors a
ch4aika [34]

Answer:

Inside directors may be members of the firm and outside directors are supposed to be elected from outside the firm.

Explanation:

A board of directors in most corporations consists of inside directors and outside directors. Inside directors are usually the members of the firm and have direct access to the company's operating. CEO, CFO and CIO are typical examples of inside directors. On the other hand, outside directors are not employees of the firm, nor stakeholders. They have unbiased opinions in board meetings.

8 0
3 years ago
The Gorman Group issued $970,000 of 13% bonds on June 30, 2021, for $1,042,973. The bonds were dated on June 30 and mature on Ju
omeli [17]

Answer:

Entries are given below

Explanation:

Cash should be recorded as an asset on the issuance of bonds and bonds should be credited as it is a liability for the company. Interest expense should be debited on a semiannual basis

June 30, 2021 ( issuance of bonds)

                                                          DEBIT          CREDIT

Cash                                                 1,042,973

Bonds payable                                                     970,000

Premium on bonds payable                                 72,973

December 31, 2021 ( interest expense)

                                                            DEBIT          CREDIT

Interest Expense                               62,578

(1,042,973 x 12% x 6/12)

Premium on bonds payable               472    

Cash                                                                          63,050

(970,000 x 13% x 6/12)

June 30, 2022 (interest expense)

                                                           DEBIT            CREDIT

Interest Expense                               62,550

(1,042,973-472) x 12% x 6/12)

Premium on bonds payable               500    

Cash                                                                             63,050

(970,000 x 13% x 6/12)

5 0
3 years ago
Johanna, a company manager, needs to keep track of how many days Each employee has worked from start date to the current date Jo
kotykmax [81]

Answer:

yes

Explanation:

because its right

3 0
3 years ago
Finer Company uses a sales journal, purchases journal, cash receipts journal, cash payments journal, and general journal. Journa
BaLLatris [955]

Answer:

Finer Company

Sales Journal:

May 7 Debit Accounts Receivable (J. Dryer) $1,527

Credit Sales Revenue $1,527

To record the sale of goods on terms 2/10, n/30, via invoice no. 5704.

May 12 Debit Accounts Receivable (R. Lamb) $421

Credit Sales Revenue $421

To record the sale of goods on terms n/30, via invoice no. 5705.

 

May 25 Debit Accounts Receivable (T. Taylor) $691

Credit Sales Revenue $691

To record the sale of goods on terms n/30, via invoice no. 5706.

Explanation:

a) Data and Analysis for Sales Journal:

May 7 Accounts Receivable (J. Dryer) $1,527 Sales Revenue $1,527 terms 2/10, n/30, invoice no. 5704.

May 12 Accounts Receivable (R. Lamb) $421 Sales Revenue $421 terms n/30, invoice no. 5705.

 

May 25 Accounts Receivable (T. Taylor) $691 Sales Revenue $691 terms n/30, invoice no. 5706.

8 0
2 years ago
The real-balances effect suggests that a
Anettt [7]

Answer:

A

Explanation:

real-balance effects do not have to so with the valuation of financial assets.

8 0
3 years ago
Other questions:
  • One year ago Lerner and Luckmann Co. issued 15-year, noncallable, 7.5% annual coupon bonds at their par value of $1,000. Today,
    15·1 answer
  • How did Federal Express use the Internet to promote their image as service providers?
    7·1 answer
  • Other than fees, what is a drawback (negative) to having credit?
    10·2 answers
  • A business client is looking for ways to decrease its monthly premiums. To get down to the premium level sought after by the com
    15·1 answer
  • Borchardt Corporation has provided the following data concerning last month’s operations. Direct materials $ 29,000 Direct labor
    15·1 answer
  • The specific collection of values, norms, beliefs, and attitudes shared by people and groups in a company is commonly referred t
    11·1 answer
  • You borrow $8000 to buy a car, at an annual interest rate of 6%. Assume interest is compounded continuously. You make monthly pa
    13·1 answer
  • The Quorum Company has a prospective 6-year project that requires initial fixed assets costing $962,000, annual fixed costs of $
    14·1 answer
  • In the figure below, ∆LMN is an equilateral triangle, side \overline {LM} LM is bisected by O, side \overline {LN} LM is bisecte
    14·1 answer
  • The​ ________ layout's main objective is to equalize the task time for each station.
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!