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baherus [9]
3 years ago
8

A manufacturer is contemplating a switch from buying to producing a certain item. Setup cost would be the same as ordering cost.

The production rate would be about double the usage rate. (Can you please show me how you did it)
1) Compared to the EOQ, the economic run size would be

A) the same

B) approx 20% larger

C) approx 40% larger

D) 20% smaller

E) approx 40% smaller

2. Compared to the EOQ, the miximum inventory would be

A) approx 70% higher

B) approx 30% higher

C) the same

D) approx 30% lower

E) approx 70% lower
Business
1 answer:
Flauer [41]3 years ago
4 0

Answer

D) compared to the EOQ, the maximum inventory would be approx 30% lower.

Explanation

EOQ = √(2*Co*D/Cc)

EPQ= √ (2*Co*D/(Cc*(1-x)))

x=D/P

D = demand rate

P =production rate

Co=ordering cost

Cc=holding cost

1) The production rate would be about double the usage rate.

hence, P = 2D

x=D/2D=0.5

EPQ= √ (2*Co*D/((1-0.5)*Cc))

EPQ= √ (2*Co*D/0.5Cc)

EPQ=√ (1/0.5)*EOQ

EPQ=√ (2)*EOQ

EPQ=1.41*EOQ

Hence, EPQ is around 40% larger than EOQ.

Ans.: c) EPQ will be approximately 40% larger than the EOQ.

2) Compared to the EOQ, the maximum inventory would be

maximum inventory = Q

EPQ = 1.41 EOQ

EPQ = 1.41*Q

Q=EPQ/1.41

Q=0.71 EPQ

Hence, compared to EOQ, maximum inventory in EPQ is only 70% of that in EOQ model.

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Answer:

The correct answer would be, Greg's next step is to roll out his Tactical Goals to his staff.

Explanation:

Greg is the division manager for Tasty Foods. His management set a goal of increasing market share and decreasing the corporate cost over the period of next three years. To cope up with this goal, Greg has to work on this from now onward. So he decides how his division can contribute to the fulfillment of these management goals. He looking into his resources and planned two possible options. One is to partnering with another company and the other is to hire a procurement manager to negotiate lower prices from vendors. Now as he has formulated these goals, which are tactical in nature, the next step is to roll out these tactical goals to hi staff. Tactical goals are the goals that are set quickly in response to the conditions or situations as they occur in the real world.

6 0
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amm1812

Answer:

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7 0
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Arlecino [84]

Answer:

A : balance sheet only

Explanation:

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So, it affects the balance sheet only. As balance sheet records all types of assets and all types of liabilities plus shareholder equity.

6 0
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Watts Corporation made a very large arithmetical error in the preparation of its year-end financial statements by improper place
daser333 [38]

Answer:

a prior period adjustment

Explanation:

A prior period adjustment -

It is the correction of the accounting error which took place in the past and was written in the prior year of financial statement , net of the income taxes , is known as a prior period adjustment .

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Answer:

$8,870

Explanation:

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Using this formula

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Let plug in the formula

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Therefore the balance in the allowance for doubtful accounts after bad debt expense is recorded will be $8,870

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