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Tpy6a [65]
3 years ago
15

Using a computerized Inventory Management System, a Paint Supply Store franchise continuously monitors the inventory of all the

paint located at each of their 15 stores and their distribution warehouse. The Paint Supply Store franchise sells an average of 74 gallons of Purple Paint every week (for 52 weeks per year, Standard Deviation of the Demand = 8 gallons). They purchase Purple Paint from their supplier at a price of $4.00 per gallon.It takes 2.50 weeks to receive an order from the supplier.Administrative costs for Ordering paint have been estimated to be $35 per order.Holding Costs = 40% of the purchase price per gallon per year.How much Safety Stock should the company hold to have a Service Level of 99.0%?
Business
1 answer:
storchak [24]3 years ago
3 0

Answer: 29.4 gallons

Explanation:

The Safety Stock that should be held by the company to have a Service Level of 99.0% will be:

= Z × σ × ✓LT

Z = 2.326

σ = Standard deviation = 8

LT = Lead time = 2.50

Safety stock = = Z × σ × ✓LT

= 2.326 × 8 × ✓2.50

= 2.326 × 8 × 1.58

= 29.4 gallons

The safety stock is 29.4 gallons.

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When people have insurance against a certain event, the notion that those people are less likely to guard against that event occ
sp2606 [1]

Answer: When people have insurance against a certain event, the notion that those people are less likely to guard against that event occurring is called a <u>moral hazard.</u>

Explanation: Moral hazard happens frequently in cases of insurance. If a person has a house, they can decide to install a vault because it reduces the risk of being robbed;

However, when the same person has arranged an insurance that covers the risk of theft of the house, they will have fewer incentives than in the previous situation, to install the security door and ultimately it will be able to increase the probability of the loss in this Theft case. This behavior, for example, before insurance coverage is called moral hazard.

4 0
3 years ago
Prepare a bank reconciliation for Cole Co. assuming the following as of May 31. Use the worksheet provided in the Ch 7 Module: 1
goblinko [34]

Answer:

Cole Co.

Bank Reconciliation Statement

Balance as per cash account adjusted $112,933

add uncredited deposits                             11,317

less Outstanding checks                         -41,750

Balance as per bank statement            $82,500

Explanation:

a) Data and Calculations:

Cash account debit balance = $95,250

Bank statement balance = $82,500

Outstanding checks = $11,317

Credit memorandum $18,000

Collection fee $45

Check 1115 for Rent Expense of $1,350 transposed as $1,050 = $300 ($1,350 - $1050)

Uncredited deposits = $41,750

Interest earned = $28

Cash Account Adjustment:

Cash account debit balance        $95,250

Debit:

Credit memorandum                      18,000

Interest earned                                      28

Credit:

Collection fee                                       -45

Rent Expense (understated)             -300

Adjusted cash account balance $112,933

b) The bank reconciliation statement above was prepared after adjusting the cash account with items that were recorded by the bank but not recorded by Cole Co. and other misstatements.  With the adjusted cash account balance, the bank reconciliation was then carried out with the items that were not recorded by the bank.  The resulting figure should agree with the bank statement balance.

4 0
3 years ago
A ten-year note is priced at par and has a (modified) duration of 7.8 years. A twenty-five year bond has a (modified) duration o
harina [27]

Answer:

Between 7.8 and 12 Years

Explanation:

The modified duration of a portfolio is defined as a weighted average in the modified duration of an individual bonds. Therefore it will lie between the extreme values of the modified duration of the bonds in portfolio so that the weights are all positive.

In the context, the modified duration lies between 7.8 years and 12 years as the modified duration would always lie between the lowest modified duration and the highest modified duration of any bonds in a portfolio. Therefore the weights are value that will lie between these two years.

6 0
3 years ago
On August 8th the​ three-month risk-free rate of interest in the United States was 3.75 percent and it was 3.00 percent in Japan
weeeeeb [17]

Answer:

The answer is 0.01082

Explanation:

The formula for forward exchange rate is:

F = S x 1+rd/1+rf

where F is the forward exchange rate

S is the spot exchange rate(0.010798)

rd is the foreign currency interest rate(3% or 0.03)

rf is the domestic interest rate(3.75% or 0.0375

Month is 3 months(90days) and total number of days in a year is 360days.

Find find the attached file for calculation

6 0
3 years ago
There are numerous exceptions to the parol evidence rule, with perhaps the most common being when ________ evidence serves to cl
jeka94

The parol evidence rule has many exceptions, with possibly the most prevalent one being when <u>oral</u> evidence serves to clear up a(n) <u>ambiguous</u> part of an  agreement.

More about the parol evidence rule:

The parol evidence rule is a principle of Anglo-American common law that controls the types of evidence that parties to a contract dispute may provide in an effort to ascertain the precise terms of the contract.

The parol evidence rule also prohibits parties who have reduced their agreement to a finalized written instrument from adding further evidence later on as proof of a different intent regarding the contract terms, such as the content of oral exchanges from earlier in the negotiation process.

Learn more about the parol evidence rule here:

brainly.com/question/15733971

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7 0
1 year ago
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