Question: New England Co. predicts that it will use 360,000 gallons of material during the year. The material is expected to cost $5 per gallon. It

New England Co. predicts that it will use 360,000 gallons of material during the year. The material is expected to cost $5 per gallon. It anticipates that it will cost $72 to place each order. The annual carrying cost is $4 per gallon.

a. Determine the most economical order quantity by using the EOQ formula.

b. Determine the total cost of ordering and carrying at the EOQ point.

Step by Step Solution

★★★★★

3.58 Rating (173 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a EOQ square root of 2CNK where C 72 N 360000 ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

298-B-C-A-M-L (114).xlsx

300 KBs Excel File

Students Have Also Explored These Related Cost Accounting Questions!

The following balance sheet is presented for J.D.F Company as of December 31, 2011. During 2012, J.D.F entered into the following transactions.Made credit sales of $1,350,000 and cash sales of...

Let the process (Xt), t 0, solve the SDE dXt =-Xidt + dB, Xo E R. (a) Show that the process Y = et X, has independent Gaussian increments, and give the distribution of the increments over the time...

A new manufacturing machine is expected to cost $286,000, have an eight-year life, and a $30,000 salvage value . The machine will yield an annual incremental after-tax income of $35,000 after...

Patriot Company predicts that it will use 360,000 gallons of material during the year. The material is expected to cost $5 per gallon. Patriot anticipates that it will cost $72 to place each order....

Economic order quantity; ordering and carrying costs Similar to Self-Study Problem 1 Dolphin Company predicts that it will use 25, 000 units of material during the year. The expected daily usage is...

Hello, I was able to get part a., but cannot seem to figure part b. Can you please help me with this. Economic Order Quantity; Order Cost; Carrying Cost New England Co. predicts that it will use...

Please solve that bottom [ A. & B ] Ony by one detail solution, to explain. Thank you very much! E2-2 Economic order quantity; order cost; carrying cost New England Co. predicts that it will use...

New England Co. predicts that it will use 360,000 gallons of material durng the year. The material is expected to cost $5 per gallon. It anticipates that it will cost $72 to place each order. The...

New England Co. predicts that it will use 360,000 gallons of material during the year. The material is expected to cost $5 per gallon. It anticipates that it will cost $72 to place each order. The...

Economic Order Quantity; Order Cost; Carrying Cost New England Co. predicts that it will use 360,000 gallons of material during the year. The material is expected to cost $5 per gallon. It...

P2-2. Economic Order Quantity: Ordering and Carrying Costs LO1 All Similar to Self-Study Problem 1 Mayer, Inc. predicts it will use 63,000 units of material during the year. The expected daily usage...

Total variation = 7447.5; SSE = 896.8; b1, = 5.7003

In Young's double slit experiment, the slits are 2 mm apart and are illuminated by photons of two wavelengths = 12000A and 2 = 10000. At what minimum distance from the common central bright fringe on...

How should Sophia adjust her inventory management during a recession to avoid excess costs and maintain cash flow?

Find the derivative. sint ! 1 du 4-u? dt cos t O A. 4- sint cos t O B. 4- sint 1 C. cos t (4- sin 2 t) O D. 4- sint 2

Find a value of a so that f is continuous at c= - 2, or indicate this is impossible. x+2 x# -2 f(x) = - 3(x+2) a, x= - 2 OA. Impossible . -3 . 2 OD. 1/3

Find the limit. 1/(1-x) lim x X-1* Select the correct choice below and fill in any answer boxes in your choice. lim x(1-x) = (Type an exact answer.) %3D A. X1* O B. The limit does not exist.

Use l'Hpital's Rule to find the limit. In (x + 8x) In x lim x-0+ Select the correct choice below and fill in any answer boxes in your choice. In (x + 8x) In x A. lim (Simplify your answer.) X0+ B....

In 750 words or more reflect on a person, place, or thing that is important to you. As you reflect, raise questions and connect your topic to larger issues that your audience might care about or be...

6. You are considering acquiring shares of common stock in the Madison Beer Corporation. Your rate of return expectations are as follows: Compute the expected return [E(Ri)] on your investment in...

Following is a list of manufactured products. For each product, would a job order or a process cost system be used to account for the costs of production? a. lumber b. buildings c. airplanes d....

What is the primary difference between the two cost accounting systems regarding the accumulation of costs and the calculation of unit costs?

What is the difference between the term unit cost as commonly used in a process cost system and the term job cost as commonly used in a job order system of cost accounting?

Raju's Conlang Problem Description As we all know Python was created by Guido van Rossum, a Dutch programmer. Raju a coding enthusiast, is trying to become a new Guido van Rossum, by developing a new...

2) Write R code that will compute the root of the following function f(x)=1+e(x1)121. Submit your R code as q2.R

You are planning to save for retirement over the next 35 years. To do this, you will invest $840 a month in a stock account and $440 a month in a bond account. The return of the stock account is...