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frez [133]
3 years ago
9

The annual demand of product Y is 1908 units. The ordering cost is $45 per order. Holding cost is $15 per unit per year. Calcula

te the annual ordering cost when the lot size (i.e., the fixed order quantity) is 67 units.
(Select the appropriate range in which your answer falls.]
a. More than 0 but less than or equal to 700
b. More than 700 but less than or equal to 850
c. More than 850 but less than or equal to 1000
d. More than 1000 but less than or equal to 1150
e. More than 1150
Business
1 answer:
Flauer [41]3 years ago
3 0

Answer:

Option E

The annual ordering cost is more than $1150

Explanation:

The ordering costs include all the clerical, administrative and transportation costs associated with placing an order.

Annual ordering cos = ordering cost per order × number of order

No of order = Annual demand/order quantity

                   = 1908/67= 28.47 orders

Annual ordering cost = 28.47× 45= $1281.49

Annual ordering cost =$1281.49

The annual ordering cost is more than $1150

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A flower delivery business wants to raise their overall sales volume to increase profit. After analyzing their costs, they choos
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7 0
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The company has an opportunity to sell 40,000 additional units at $12 per unit. The additional sales would not affect its curren
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Answer:

$1,576,000

Explanation:

The computation of the combined total net income is shown below:

<u>Particulars     Normal volume  Additional volume  Combined total </u>

Sales              $6,000,000         $480,000               $6,480,000

                                                (40,000 × $12)

Less: Costs and expenses    

Direct material $800,000            $80,000               $880,000

                                          ($800,000  ÷ 400,000 × 40,000)

Direct labour    $1,600,000         $160,000             $1,760,000

                                        ($1,600,000 ÷ 400,000 × 40,000)

Overhead        $400,000          $64,000                $464,000

                                                ($400,000 × 16%)

Selling expenses $600,000     $0                         $600,000

Administrative

expense           $1,028,000   $172,000                $1,200,000

Total costs

and expenses $4,428,000    $476,000             $4,904,000

Incremental

income

(loss) from

new busines   $1,572,000   $4,000               $1,576,000

We assume reduced price of $12 per unit instead of $13 per unit

8 0
2 years ago
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