Required: 1. Determine the high point and the low point. The month with a high number of
Question:
Required:
1. Determine the high point and the low point.
The month with a high number of purchase orders | October |
The month with a low number of purchase orders | March |
2. Calculate the variable rate for purchasing cost based on the number of purchase orders. (Round to the nearest cent.)
_______per purchase order
3. Calculate the fixed monthly cost of purchasing.
4. Write the cost formula for the purchasing activity showing the fixed cost and the variable rate. Round variable rate to the nearest cent.
Total purchasing cost | = | ______ | + | _______ | x | Purchase orders ) |
5. If McGarvey Manufacturing Company estimates that next month will have 480 purchase orders, what is the total estimated purchasing cost for that month?
6. What if McGarvey Manufacturing wants to estimate purchasing costs for the coming year and expects 6,000 purchase orders? What will the estimated total purchasing cost be?
-What is the total fixed purchasing cost?
Money Banking and Financial Markets
ISBN: 978-0078021749
4th edition
Authors: Stephen Cecchetti, Kermit Schoenholtz