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
Alja [10]
3 years ago
8

R. C. Barker makes purchasing decisions for his company. One product that he buys costs $50 per unit when the order quantity is

less than 500. When the quantity ordered is 500 or more, the price per unit drops to $48. The ordering cost is $30 per order and the annual demand is 7,500 units. The holding cost is 10 percent of the purchase cost. If R. C. wishes to minimize his total annual inventory costs, he must evaluate the total cost for two possible order quantities. What are these two possible quantities?
a. 300
b. 306
c. 500
d. 200
e. None of the above
Business
1 answer:
astra-53 [7]3 years ago
5 0

Answer:

a. 300

d. 200

Explanation:

EOQ = \sqrt{(2 * Annual demand * ordering cost) / holding cost } \\

2 * 7500 * 30 / 0.5

EOQ = 948 units

When price is $48 per unit

EOQ = 968 units

Total cost  = Holding cost + ordering cost + purchase cost

When the order is for 500 price is $48

Total cost = $2,400 + $30 + $24,000 = $26,430

When the order is for 300 price is $50

Total cost = $1,500 + $30 + $15,000 = $16,530

When the order is for 306 price is $50

Total cost = $1,530 + $30 + $15,300 = $16,860

When the order is for 200 price is $50

Total cost = $1,000 + $30 + $10,000 = $11,030

The best two possible order quantities are 200 and 300 which results in minimum total cost.

You might be interested in
Management of Mcgibboney Corporation has asked your help as an intern in preparing some key reports for November. The beginning
harkovskaia [24]

Answer:

$87,000

Explanation:

Calculation of the conversion cost for November.

Conversion cost can be defined as the combination of both direct labor costs and manufacturing overhead costs that are vital to help convert raw materials into product.

Using this formula

Total Conversion cost = Direct labor cost + Manufacturing overhead cost

Hence,

Direct labor cost $25,000

Add Manufacturing overhead cost $62,000

Total Conversion cost $87,000

Therefore the conversion cost for November is $87,000

4 0
3 years ago
Rick Wing has a repetitive manufacturing plant producing automobile steering wheels. Use the following data to prepare for a red
Ilya [14]

Answer:

$5.74

Explanation:

Q* = 2DS / H[1-(d/p)]

Q² = 2DS / H[1-(d/p)]

S = (Q²)(H)[1 - (d/p) / 2D

Setup cost S = (200^2)*(10)*(1 - (100/800)) / 2*30,500

Setup cost S = 40000*10*0.875 / 61000

Setup cost S = 350000 / 61000

Setup cost S = 5.737704918032787

Setup cost S = $5.74

3 0
2 years ago
Steve borrowed $750 for a new dresser. He made 9 monthly payments to repay the loan. He paid $45 interest. What is his simple in
GuDViN [60]

Answer:

222

Explanation:

8 0
2 years ago
Explain why peccarelli returned to guatemala and describe the goals his team are trying to accomplish.
Leno4ka [110]

The reason why Peccarelli returned to Guatemala was to look for the bodies of a tragedy that happened in his childhood and help identify them. His team’s goals are to talk to the families of the deceased and to give the families closure.

7 0
3 years ago
A company reports the following beginning inventory and purchases for the month of January. On January 26, the company sells 350
Triss [41]

Answer:

Ending inventory= $494

Explanation:

Giving the following information:

On January 26, the company sells 350 units. 150 units remain in ending inventory on January 31.

January 1: 320 units for $3.00

January 9: 80 units for $3.20

January 25: 100 units for $3.34

Ending inventory= 100*3.34 + 50*3.2= $494

6 0
3 years ago
Other questions:
  • Greg’s Golf Carts produces two models: Model 24 has sales of 500 units with a contribution margin of $40 each; Model 26 has sale
    14·1 answer
  • I want to study accounting at levels 2 and 3. What can you offer me in my choice of subjects? Would this come under 'Business'?
    8·1 answer
  • Why can a price discriminating monopolist be both more profitable and more efficient (i.e., produce greater net benefits for soc
    11·2 answers
  • Anna decides to add new sales representatives and increase advertising to increase sales in her existing market for her current
    7·1 answer
  • The Body Shop, Timberland, and Patagonia behave in environmentally responsible ways that differentiate them from competitors, bu
    10·1 answer
  • Use the following classification to determine which category each of the following goods falls into.
    7·1 answer
  • Juan Carlos originally hoped to purchase a home. However, because he could not earn enough money to ever afford one, he decided
    10·1 answer
  • Answer each of the following independent questions. Required: Alex Meir recently won a lottery and has the option of receiving o
    7·1 answer
  • If Tarek and Samantha do not write wills and one or both were to pass away, how will the distribution of their assets be decided
    13·1 answer
  • Justin, a member, has been in public practice for 25 years. His firm does bookkeeping and financial statements for approximately
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!