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  • What is the economic order quantity for the inventory item to the nearest whole unit? The purchase price of an inventory item is $25 per unit. In each three month period, the usage of the item...
    What is the economic order quantity for the inventory item to the nearest whole unit? The purchase price of an inventory item is $25 per unit. In each three month period, the usage of the item...
    1,461. (2x20 x (4x20,00)/Co.06x25^0.5=1,461 Units. In marketing, carrying the cost of inventory or holding cost refers to the total cost of holding inventory, which includes cost such as rent expressed as a percentage of the cost of inventory. The economic order aggregate is the number of individual units that a company should add to items such as holding, order costs, and shortages. The EOQ is utilized as a portion of a continuous review inventory system where the inventory is surveiled at all times and a fixed quantity each time the inventory level reaches a specific reorder point. Some companies use an auto-replenishment system.

  • What is the optimal reorder quantity (to the nearest 100 units)? Sky Limited wishes to minimize its inventory costs. At the moment its reorder quantity is 1,000 units. Order costs are $10 per...
    What is the optimal reorder quantity (to the nearest 100 units)? Sky Limited wishes to minimize its inventory costs. At the moment its reorder quantity is 1,000 units. Order costs are $10 per...
    1,700units {[ 2 x 10 x (15,000)] / 0.10]}^0.5 = 1,732 units  

  • A company employed 5,700 employees at the end of a financial year. During the year 600 employees left the company and 360 were recruited. What was the rate of labour...
    A company employed 5,700 employees at the end of a financial year. During the year 600 employees left the company and 360 were recruited. What was the rate of labour...
    1. 10.3%Employees at the beginning of the year = 5,700 360 + 600 = 5,940 Average number of employees = (5,700 + 5,940)/2 = 5,820 Labour turnover = (600/5,820) x 100% = 10.3%

  • A company manufactures Product Z in batches. Output capavity is 1,000 units of Product Z per week but demand is only 200 units per week. There are 50 weeks in each year. The annual cost of holding...
    A company manufactures Product Z in batches. Output capavity is 1,000 units of Product Z per week but demand is only 200 units per week. There are 50 weeks in each year. The annual cost of holding...
    1. 3,200 units{[ 2 x 800 x (200 x 50)] / [2 x (1 - (200 / 1,000))}^0.5 = 3,162 units or 3,200 units to the nearest 100 units.

  • A company pays £2,000 as annual lease charge for a car with CO2 emission of 155g/km. The cost is fully deductible.
    A company pays £2,000 as annual lease charge for a car with CO2 emission of 155g/km. The cost is fully deductible.
    1. TrueExplanation: With CO2 emission of up to 160g/km, all expenditure is deductible. If CO2 emission exceeds 160g/km, 15% of the lease charges are not deductible.

  • Why is the EOQ model the most accepted model for determining order quantity for raw materials?
    Why is the EOQ model the most accepted model for determining order quantity for raw materials?
    EOQ: Lower, Annual Holding Cost: Lower

  • What is the total cost at an activity of 2,000 units? An organisation has the following total costs at two activity levels. Activity Level (units) 16,000 22,000 Total Costs ($) 135,000 170,000....
    What is the total cost at an activity of 2,000 units? An organisation has the following total costs at two activity levels. Activity Level (units) 16,000 22,000 Total Costs ($) 135,000 170,000....
    $160,000Variable Cost/Unit: [(170,000-5,000) - 135,000] / (22,000 - 16,000) = $5 Total Fixed Cost (below 17,000 units): [135,000 - (16,000 x 5)] = $ 55,000 Total Cost for 20,000 units: 55,000 + 5,000 + (20,000 x 5) = $160,000

  • What is the employee's gross pay for that day? An prganisation operates a peicework system of remuneration, but also guarantees its employees 80% of a time-based rate of pay which is based on $20...
    What is the employee's gross pay for that day? An prganisation operates a peicework system of remuneration, but also guarantees its employees 80% of a time-based rate of pay which is based on $20...
    $180200 units x (3 / 60) x 18 = $180

  • What was the rate of labour turnover in the year? A company employed 5,700 employees at the end of a financial year. During the year 600 employees left the company and 360 were recruited.
    What was the rate of labour turnover in the year? A company employed 5,700 employees at the end of a financial year. During the year 600 employees left the company and 360 were recruited.
    10.3%Employees at the beginning of the year = 5,700 360 + 600 = 5,940 Average number of employees = (5,700 + 5,940)/2 = 5,820 Labour turnover = (600/5,820) x 100% = 10.3%

  • What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    EOQ: Lower, Annual Holding Cost: Lower

  • What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    EOQ: Lower, Annual Holding Cost: Lower

  • What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material? A company always determines its order quantity for a raw...
    EOQ: Lower, Annual Holding Cost: Lower

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