Explanation:
a. The computation of the economic order quantity is shown below:
![= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}](https://tex.z-dn.net/?f=%3D%20%5Csqrt%7B%5Cfrac%7B2%5Ctimes%20%5Ctext%7BAnnual%20demand%7D%5Ctimes%20%5Ctext%7BOrdering%20cost%7D%7D%7B%5Ctext%7BCarrying%20cost%7D%7D%7D)
![= \sqrt{\frac{2\times \text{300}\times \text{\$500}}{\text{\$18}}}](https://tex.z-dn.net/?f=%3D%20%5Csqrt%7B%5Cfrac%7B2%5Ctimes%20%5Ctext%7B300%7D%5Ctimes%20%5Ctext%7B%5C%24500%7D%7D%7B%5Ctext%7B%5C%2418%7D%7D%7D)
= 130 units
The carrying cost is
= $90 × 20%
= $18
b. Total annual cost is
![= \sqrt{2\times300 \times\$500 \times\$18}](https://tex.z-dn.net/?f=%3D%20%5Csqrt%7B2%5Ctimes300%20%5Ctimes%5C%24500%20%5Ctimes%5C%2418%7D)
= $2,323.79
c. The number of orders would be equal to
= Annual demand ÷ economic order quantity
= $300 ÷ 130 units
= 2.31 orders
d, The time between orders is
= 52 weeks ÷ 2.31 orders
= 22.51 weeks
Answer:
Break-even point in units= 13,300
Explanation:
Giving the following information:
Unitary selling price= $450
Fixed cost= $870,000
Unitary variable cost= $300
Desired profit= $1,125,000
<u>To calculate the units to be sold, we need to use the break-even point with desired profit:</u>
<u></u>
Break-even point in units= (fixed costs + desired profit) / contribution margin per unit
Break-even point in units= (870,000 + 1,125,000) / (450 - 300)
Break-even point in units= 13,300
Companies with a high degree of operating leverage (DOL) tend to have a higher percentage of fixed costs, which remain largely constant regardless of production volume, whereas companies with a low degree of operating leverage tend to have cost structures with a higher proportion of variable costs that are closely related to production volume.
A cost-accounting method called operating leverage assesses how much a company or project can raise operating income by raising revenue. Businesses with high operating leverage generate revenues with low variable costs and large gross margins. Operating leverage is used to calculate a company's break-even point, which also helps identify the appropriate selling prices to pay all costs and turn a profit. Businesses with substantial operational leverage must pay a higher monthly amount of fixed costs regardless of whether they sell any units of product. The potential risk from forecasting risk, where a relatively modest inaccuracy in sales forecasting can be compounded into huge errors in cash flow predictions, increases with the level of operating leverage.
Learn more about leverage from
brainly.com/question/24278932
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Answer:
- d
- b
- e
- a
- c
Explanation:
Currency exchange: service to provide customers with money of foreign countries.
Safety deposit box: a storage place for valuable items
Financial counseling: a service related to investments and estate planning
Traveler's check: a check that can be replaced if it is lost or stolen
Cashier's check: a check that is guaranteed by the bank itself
Answer:
The correct answer would be option D, Legal Market for a market price that is lower.
Explanation:
If there is a store which sells the goods at the market price even though the government authorities have set the minimum price that can be charged, it means store is selling the product at a price which is higher than the minimum price set by the government, but it doesn't mean that the store owner is doing any illegal trading. This is because the government has set the lower price limit but that ceiling price is non binding. It is not necessary for the market sellers to sell at the price given by government. So they are operating in a legal market for a market price that is lower.