Decor Ltd has the following figures regarding its inventory: Cost price per unit NS50 per unit...
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Decor Ltd has the following figures regarding its inventory: Cost price per unit NS50 per unit Storage cost per unit per year N$5 per unit Weekly demand (usage) 2 000 units Normal delivery time 2.5 weeks Insurance cost per unit per year NS5 per unit Interest rate 9% Ordering cost for 2 orders NS80 Safety stock 5 000 units There are 50 normal working weeks per year, and four weeks in one month. REQUIRED: 3.1.1 Calculate the economic order quantity (EOQ) 3.1.2 Calculate the number of orders per year 3.1.3 Determine the ordering cost per year 3.1.4 Determine the total inventory cost for the year Decor Ltd has the following figures regarding its inventory: Cost price per unit NS50 per unit Storage cost per unit per year N$5 per unit Weekly demand (usage) 2 000 units Normal delivery time 2.5 weeks Insurance cost per unit per year NS5 per unit Interest rate 9% Ordering cost for 2 orders NS80 Safety stock 5 000 units There are 50 normal working weeks per year, and four weeks in one month. REQUIRED: 3.1.1 Calculate the economic order quantity (EOQ) 3.1.2 Calculate the number of orders per year 3.1.3 Determine the ordering cost per year 3.1.4 Determine the total inventory cost for the year
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Answer rating: 100% (QA)
aTo calculate the Economic order Quantity EOQ we use the formula EOQ 2DSH Where D ... View the full answer
Related Book For
Management and Cost Accounting
ISBN: 978-1405888202
4th edition
Authors: Alnoor Bhimani, Charles T. Horngren, Srikant M. Datar, George Foster
Posted Date:
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