1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Viefleur [7K]
3 years ago
9

A produce distributor uses 774 packing crates a month, which it purchases at a cost of $12 each. The manager has assigned an ann

ual carrying cost of 34 percent of the purchase price per crate. Ordering costs are $29. Currently the manager orders once a month. How much could the firm save annually in ordering and carrying costs by using the EOQ? (Round intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)
Business
1 answer:
ki77a [65]3 years ago
6 0

Answer:

$444.42

Explanation:

For computing the saving amount, first need to calculate the economic order quantity, total cost etc

The economic order quantity is

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

where,

Annual demand is

= 774 packaging crates × 12 months

= 9,932 crates

And, the carrying cost is

= $12 × 34%

= $4.08

= \sqrt{\frac{2\times \text{9,288}\times \text{\$29}}{\text{\$4.08}}}

= 363.37 crates

Now the total cost is

= Annual ordering cost + Annual carrying cost

= Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit

= 9,288 ÷ 363 × $29 + 363 ÷ 2 × $4.08

= $742.02 + $740.52

= $1,482.54

Now the total cost in case of 774 packing crates is

= Annual ordering cost + Annual carrying cost

= Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit

= 9,288 ÷ 774 × $29 + 774 ÷ 2 × $4.08

= $348 + $1,578.96

= $1,926.96

So, the annual saving cost is

= $1,926.96 - $1,482.54

= $444.42

You might be interested in
Discuss the elements of UX in relation to company strategy
iren [92.7K]

Answer:

2+y

Explanation:

4 0
3 years ago
Tone Loc and 89 of his biggest fans formed an S corporation, 2hit, Incorporated, as the original 90 shareholders. Tone then tran
Alja [10]

Answer:

92 shareholders

Explanation:

According to the S corporation shareholder limit rules, family members count only as 1 shareholder. The meaning of family member is very broad, including spouses, uncles, aunts, children, grandparents, grandchildren, first cousins, and even ex-spouses count as members of the same family.

So that means that Tone Loc, his grandfather, his four cousins, his five children and three of his grandchildren, will all together count as just one shareholder.

His two friends are not included in his family.

5 0
3 years ago
We observe both the price and quantity sold of ketchup falls over time. assuming all else stayed the same, this is due to:
kolezko [41]
The reason behind the falling of price and quantity of ketchup sold is that the cost of mustard seeds decreases as mustard is a substitute of ketchup and for the input mustard seeds are produced. So, if the price of mustard seed decreases, the price of ketchup also decreases.
4 0
3 years ago
Megan Company (not a corporation) was careless about its financial records during its first year of operations, 2017. It is Dece
Ilya [14]

Answer:

Megan Company

Analysis of Error and Indication of its effect on 2013 and 2014 Net Income, Assets, and Liabilities:

                  Net Income                 Assets                     Liabilities

            2013          2014          2013        2014          2013      2014

1.           O                                   O

2.          O                U                                                   U

3.          U                O                U

4.          O                U                U

5.          O                U                                                  U

6.          U                                   O

7.                                                U                               U

Explanation:

a) Data and Calculations:

Codes to indicate the effect of each dollar amount: O = overstated, U = understated, and NE = no effect.

The overstatement of Net Income happens when an expense incurred is not recorded in the affected period or a revenue not earned is recognized in the wrong period.  For instance, when depreciation expense for 2013 is not recorded in 2013, the net income is overstated.  We cannot assume that the error is corrected in 2014, according to this question.

6 0
3 years ago
The $25 you deposit into your savings account when you receive a paycheck is an example of money being used as a
Leni [432]
Well u are saving money for something
7 0
3 years ago
Read 2 more answers
Other questions:
  • Suppose a country's productivity last year was 84. if this country's productivity growth rate of 5% is to be maintained, this me
    6·1 answer
  • _____________ - a term referring to the fact that for many goods, as the level of production increases, the average cost of prod
    9·1 answer
  • What do the underlying values in your mission statement tell you?
    5·2 answers
  • Productivity is the combination of
    6·2 answers
  • True or False: Victoria's Secret, with its low-priced holiday discounts, exemplifies a firm pursuing cost-leadership; while Wal-
    7·2 answers
  • In an​ economy, the​ working-age population is 100 million.
    15·1 answer
  • _____ are one of the inputs to manufacturing and service-delivery processes. a. Subassemblies b. Stock-keeping units c. Finished
    11·1 answer
  • Classify each statement about the Federal Reserve System as either true or false.
    14·1 answer
  • Can a student provide a student ID to purchase alcohol
    6·2 answers
  • The income statement reports all of the following except: Group of answer choices The time period over which the earnings occurr
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!