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Ksenya-84 [330]
3 years ago
5

George Heinrich uses 1,500 per year of a certain subassembly that has an annual holding cost of $45 per unit. Each order placed

costs George $150. He operates 300 days per year and has found that an order must be placed with his supplier 6 working days before he can expect to receive that order. The economic order quantity is units (enter your response as a whole number). The annual holding cost is $ (enter your response as a whole number). The annual ordering cost is $ (enter your response as a whole number). The reorder point is units (enter your response as a whole number).
Business
1 answer:
Effectus [21]3 years ago
6 0

Answer:

a. 100 units

b. $2,250

c $2,250

d. 30 units

Explanation:

a. The estimation of the economic order quantity is presented below:

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

= \sqrt{\frac{2\times \text{\1,500}\times \text{\$150}}{\text{\$45}}}

= 100 units

b. The annual holding cost would be

= Economic order quantity ÷ 2  × annual holding cost per unit

= 100 units ÷ 2 × $45

= $2,250

The Economic order quantity ÷ 2  is also known as average inventory

c. The annual ordering cost would be

= Annual demand ÷ economic order quantity  × ordering cost per order

= 1,500 ÷ 100 × $150

= $2,250

The Annual demand ÷ economic order quantity is also known as number of orders

d. The reorder point would be

= Annual demand ÷ total number of days in a year × working days

= 1,500 ÷ 300 days × 6 working days

= 30 units

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3 years ago
The units of an item available for sale during the year were as follows: Jan. 1 Inventory 40 units at $165 $6,600 Aug. 13 Purcha
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Answer:

a. FIFO - Inventory Used: $39900  Remaining Inventory: $14700

b. LIFO - Inventory Used: $41700 Remaining Inventory: $12900

c. Weighted Average Cost - Inventory Used: $40950 Remaining Inventory: $13650

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Jan 01. Beginning inventory = 40 x $165 = $6600

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Nov 30. Purchases 60 x $200 = $12000

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Total = $39900

Remaining Inventory:

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(b) Last-In-First-Out

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165 x $180 = $29700

Total = $41700

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35 x $180 = $6300

Total = $12900

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This is whereby you divide the cost of goods sold by the number of units available for sale.

54,600 / 300 = $182

Inventory Used: 225 x $182 = $40950

Remaining inventory = 75 x $182 = $13650

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