2. A toy manufacturer uses approximately 32,000 silicon chips annually. The chips are used at a steady rate during the 240 days the plant operates. Annual holding cost is P27 per chip and ordering cost is P1,080. Lead time = 1 week.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A. Find the reorder point (Complete steps of computation please)

B. What would be the ordering policy for this item?

2. A toy manufacturer uses approximately 32,000 silicon chips annually. The chips are
used at a steady rate during the 240 days the plant operates. Annual holding cost is
P27 per chip and ordering cost is P1,080. Lead time - 1 week.
Transcribed Image Text:2. A toy manufacturer uses approximately 32,000 silicon chips annually. The chips are used at a steady rate during the 240 days the plant operates. Annual holding cost is P27 per chip and ordering cost is P1,080. Lead time - 1 week.
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