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Travka [436]
4 years ago
8

C&A sells T-shirts for $20 that cost $5 to produce. The annual holding cost percentage is 10% and the T-shirts turn 25 times

a year. What holding cost does C&A incur for each T-shirt? $0.50 $0.02 $0.08 $0.04
Business
1 answer:
ad-work [718]4 years ago
4 0

Answer:

$0.02

Explanation:

C&A sells T-shirts for $20 that cost $5 to produce

The annual holfing cost percentage is 10%

The T-shirts turn 25 times a year

The first step is to calculate the holding cost

= $5 × 10/100

= $5 × 0.1

= 0.5

Therefore, since the T-shirts turn over 25 times a year then, the holding cost that C&A incurs for each T-shirts can be calculated as follows

= 0.5/25 times

= $0.02

Hence C&A incur a holding cost of $0.02 for each T-shirts

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