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Sergeu [11.5K]
3 years ago
11

6.3) Annie Lennox recently took over a cleaning supply store. Her predecessor always ordered carpet shampoo in quantities of 100

units. Annie is reevaluating this policy. Based on her analysis, the cost to place each order is $35 and the holding cost is $8 per shampoo bottle per year. The annual demand for this product is 2500 bottles. Should Anne change the current order policy and, if so, how much can she save
Business
1 answer:
nata0808 [166]3 years ago
7 0

Answer:

Annie should increase the order size to 148 bottles per order and she will be able to save $91.85 per year.

Explanation:

we must calculate the economic order quantity (EOQ) in order to determine the size of the order that reduces costs:

EOQ = √[(2 x S x D) / H]

  • S = cost per order = $35
  • D = annual demand = 2,500 bottles of shampoo
  • H = holding cost per unit) = $8

EOQ = √[(2 x 35 x 2,500) / 8] = √(175,000 / 8) = √21,875 = 147.90 ≈ 148 bottles of shampoo

total cost when ordering 100 bottles = (25 orders x $35) + (100/2 x $8) = $875 + $400 = $1,275

total cost when ordering 148 bottles = (16.89 orders x $35) + (148/2 x $8) = $591.15 + $592 = $1,183.15

Annie will save $1,275 - $1,183.15 = $91.85 per year

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3 years ago
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<u>A certificate of deposit account will have the highest interest rate. </u>

Further Explanation:

Interest rate:

The interest rate is the rate of interest earned on investment for a particular time period. Account refers to the investment of money made for a particular period. The investors invest in those account which provides the highest rate of return. If the investor gets a lower rate of return, he is not interested in investing the money.  

Certificate of deposit:

A certificate of deposit is the type of account in which the investment has been made for a particular time period. It provides the highest interest rate. The investor invests in this type of account when he does not need the money immediately. He makes this type of investment for an extended period of time for different purposes. The investor makes this investment in case of long term funds needed for a particular purpose. For example, the marriage of the son or daughter, sometimes the investor may face the disease problem, purchase of land, purchase of the home, purchase of the car and many more purposes. As this investment provides a higher rate of interest, it will increase the amount of principal that the investor deposited.

Therefore, the certificate of deposit provides the highest interest rate.

Learn more:

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<u>brainly.com/question/5057443 </u>

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Answer details:

Grade: Middle School

Subject: Business  

Chapter: Money and banking

Keywords:  certificate of deposit, higher interest rate, investment, investor, provides, deposited, particular time period.

7 0
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4 0
1 year ago
On October 1, Courtland Company sold merchandise in the amount of $5,800 to Carter Company, with credit terms of 2/10, n/30. The
Vilka [71]

Answer:

The journal entry that Courtland makes on October 8 is:

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Explanation:

On October 1, when Courtland Company sold merchandise, the following entries were made:

1. Debit Cost of goods sold $4,000

Credit Merchandise $4,000

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Credit terms of 2/10, n/30 means that 2% discount for the payment within 10 days and the full amount to be paid within 30 days.

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The journal entry that Courtland makes on October 8 is:

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3 0
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qaws [65]

Answer:

D. none of these answer choices are correct.

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3 0
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