I believe it's B but I am not positive. I'm taking the test right now.
Answer:
$3,412
Explanation:
The computation of the economic order quantity is shown below:
=
=
= 2,954 units
The carrying cost is
= $15.40 × 15%
= $2.31
The number of orders would be equal to
= Annual demand ÷ economic order quantity
= 120,000 ÷ 2,954 units
= 40.62 orders
Now The total cost of ordering cost is
Ordering cost = Number of orders × ordering cost per order
= 40.62 orders × $
84
= $3,412
Answer:
the net impact on these items is $5,000 gain
Explanation:
The computation of the net impact on these items is as follows;
Net effect is
= Gain - Loss - suspended loss
= $50,000 - $15,000 - $40,000
= $5,000 gain
hence, the net impact on these items is $5,000 gain
We simply applied the above formula so that the correct value could come
And, the same is to be considered