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Orlov [11]
3 years ago
9

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. orders 500 units each time he places an order, what would the total annual holding cost be
Business
1 answer:
aleksandrvk [35]3 years ago
6 0

Answer:

$1,200

Explanation:

total annual holding cost = average number of units in inventory x annual holding cost per unit

  • average number of units in inventory = 500 units / 2 = 250 units
  • annual holding cost per unit = $48 x 10% = $4.8

total annual holding cost = $4.80 x 250 units = $1,200

Total annual holding cost per unit includes all the costs associated to keeping a certain inventory level, e.g. warehouse costs like rent and utilities, salaries of hte employees that work in the warehouse, insurance, etc.

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Your career goals might help determine the postsecondary educational institute you attend.
Phantasy [73]

Answer:

true

Explanation:

What you do now or what your planning on doing can always determines what you can possibly do next. But you have to make sure your not doing or posting anything bad on the internet or else they won't hire you.

7 0
3 years ago
Tempest Enterprises began operations on January 1, 20x1, with all of its activities conducted from a single facility. The compan
Ray Of Light [21]

Answer:

100% will be included in the Income Statement

Explanation:

Always remember that the depreciation calculated for the accounting period can be apportioned as per the International Accounting Standard IAS 2, which says that expenses must be classified in a manner that results in the truth & fairness of the Financial Statements. This means that if depreciation calculated is $500 then the whole of this depreciation will be expensed out in the income statement. It's 20% might go to selling activities, 35% to administrative activities, and 45% to manufacturing activities.

<h3><em>B</em><em>ut remember that the depreciation calculated for the accounting period would be expensed out by $500 in the income statement, for the period generated.</em></h3>
3 0
2 years ago
To record purchases on account, Caleigh’s Company uses the perpetual inventory method and the gross method. On September 11, it
vfiekz [6]

Answer:

The company should credited on the Cash account and the Cash Discount Receipt for the settlement of the inventory with 10 days.

Explanation:

The detailed entry will be:

19th Sep

Dr Account Payable               $40,000

Cr Cash                                  $39,200

Cr Cash Discount Receipt    $800

( to record payable settlement and the receipt of cash discount)

Working note: As the company paying with 10 days, the supplier will allow a 2% discount on it net inventory purchase ( 44,000 - 4,000 = $40,000)

Thus, the discount will be 40,000 x 2% = $800 and Cash repayment will be 40,000 x (1-2%) = $39,200.  

7 0
3 years ago
Assume that on February 1, Procter &amp; Gamble (P&amp;G) paid $729,600 in advance for 2 years’ insurance coverage. Prepare P&am
Readme [11.4K]

Answer:

Journal entry on February 1:

Debit Prepaid Insurance $729,600

Credit Cash $729,600

Annual adjusting entry on June 30:

Debit Insurance Expense $152,000

Credits Prepaid Insurance $152,000

Explanation:

On February 1, Procter & Gamble (P&G) paid $729,600 in advance for 2 years’ insurance coverage. The company records the insurance as the prepaid Insurance:

Debit Prepaid Insurance $729,600

Credit Cash $729,600

On Jun 30, the last day of the following 5 months, the company records an adjusting entry that Credits Prepaid Insurance for $152,000 ($729,600 divided by 24 months times the 5 months that will be prepaid as of Jun 30) and Debits Insurance Expense for $152,000

Debit Insurance Expense $152,000

Credits Prepaid Insurance $152,000

7 0
3 years ago
The oil price shocks of 20062009: Between 2006 and the middle of 2008, oil prices rose sharplyfrom around $60 to more than $140
dolphi86 [110]

Answer:

A supply shock is an unpredictable incident that changes the supply of a product or a service, subsequent in an unexpected modification in its value. Supply shocks can be undesirable (decreased supply) or optimistic (increased supply)

(a) The two types of shock which are:  

  • Primarily the growth in oil values is a negative supply shock causing from a decline in supply of oil  
  • The reduction in oil charges is a Positive supply shock causing from a growth in supply of oil.

(b) If the charges of oil increases as in case (i) that will push companies’ prices and thus decrease SRAS. The new equilibrium will be established at a inferior level of output and higher charge level. This is reflected in the diagram attached.

In the case (ii), the opposed of this will occur. The SRAS will rise shifting the SRAS rightward and carry about a new equilibrium at upper level of output and lesser prices.

6 0
3 years ago
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