Upton Company purchases 4,000 units of Beta each year in lots of 400 units per order. The

Question:

Upton Company purchases 4,000 units of Beta each year in lots of 400 units per order. The cost of placing one order is $20, and the cost of carrying one unit of product in inventory for a year is $4.

Required:

1. What is the EOQ for Beta?

2. How many orders for Beta will Upton place per year under the EOQ policy?

3. What is the total annual ordering cost of Beta under the EOQ policy?

4. What is the total annual carrying cost of Beta under the EOQ policy?

5. What is the total annual cost of Upton's inventory policy for Beta under the EOQ policy?

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Cornerstones of Managerial Accounting

ISBN: 978-0176530884

2nd Canadian edition

Authors: Maryanne M. Mowen, Don Hanson, Dan L. Heitger, David McConomy, Jeffrey Pittman

Question Posted: Nov 30, 2017 09:30 AM

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Upton Company purchases 4,000 units of Beta each year in lots of 400 units per order. The

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1 EOQ 200 units 2 Number of orders 20 orders per year 3 Total ordering co...View the full answer

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