Answer:
a. 300 units
b. $3,750
c. $3,750
d. 100 units
Explanation:
a. The computation of the economic order quantity is shown below:
=
=
= 300 units
The number of orders would be equal to
= Annual demand ÷ economic order quantity
= 15,000 ÷ 300 units
= 50 orders
And, The average inventory would equal to
= Economic order quantity ÷ 2
= 300 units ÷ 2
= 150 units
The total cost of ordering cost and carrying cost equals to
b. Carrying cost = average inventory × carrying cost per unit
= 150 units × $25
= $3,750
c. Ordering cost = Number of orders × ordering cost per order
= 50 orders × $75
= $3,750
d. The reorder point would be
= Annual demand ÷ number of days × lead time
= 15,000 ÷ 300 days × 2 working days
= 100 units
Answer:
If the U.S. government decided to regulate the prices of airline tickets to keep them from falling when the economy is weak, there would tend to be a <u>SUPPLY SURPLUS</u> of airline tickets in the market and this would likely <u>DECREASE</u> the profits of U.S. airlines.
Explanation:
In order to regulate the prices of airline tickets, the government will most likely impose a binding price floor, which means setting up a minimum price. The problem is that since the price floor is above the equilibrium price, then the quantity supplied will increase (as price is higher) but the quantity demanded will decrease (since the price is too high).
A price floor always results in a loss of economic efficiency resulting in a deadweight loss that hurts both suppliers and consumers. Suppliers will offer more services increasing their costs, while consumers will stop flying.
Answer:
Letter B is correct. <u>Memo.</u>
Explanation:
A memo can be defined as an official document that is used in the transmission of quick information, widely used in public and private institutions. The purpose of the memo is to assist in internal or external communication in the form of short texts, which present some essential characteristics, such as cohesion and clarity, so that there is greater understanding and reduction of bureaucracy in matters.
Answer:
7,500 units
Explanation:
Given that,
Selling price = $25 per unit
Fixed expenses = $33,000 per year
Break even units sell = 5,500 units
Target profit = $12,000
Total break- even sale in Dollar:
= Selling price × Break even units sell
= $25 × 5,500 units
= $137,500
Break- even Point = Fixed Costs ÷ Contribution Margin per Unit
Therefore,
Contribution Margin per unit:
= Fixed Costs ÷ Break-Even points
= $33,000 ÷ $137,500
= 0.24 per unit
Sales amount:
= (Fixed costs + Target profit) ÷ Contribution margin per unit
= ($33,000 + $12,000) ÷ 0.24
= $187,500
Sales in units = Sales in amount ÷ Selling price per unit
= $187,500 ÷ $25
= 7,500 units
I believe that C is the correct choice out of the answers given above.
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