4. Annual Demand for a product is constant at 80 000 units. Costs for placing orders, transportation and receiving consignments are fixed at P1 200. Each inventory cycle costs P50 per unit and comes with a holding cost of 6%. Required Determine the number of units that should be ordered to replenish inventory and number of orders per year. (5 marks)

4. Annual Demand for a product is constant at 80 000 units. Costs for placing orders, transportation and receiving consignments are fixed at P1 200. Each inventory cycle costs P50 per unit and comes with a holding cost of 6%. Required Determine the number of units that should be ordered to replenish inventory and number of orders per year. (5 marks)

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 2CE: Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An...

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The following information relates to a company . The fixed cost per order is ksh 1,500 The purchase price per unit is ksh 35 The carrying costs per unit of inventory 10% of the purchase price The annual demand is 5,000units Calculate theEconomic Order Quantity Total number of orders in a year Leadtime
2. Hamid Company consumes inventory of 100,000 units of components per year. The carrying cost per unit is RO 3.50. The fixed order cost is RO 20 per order. The production planning is 365-day year. The delivery time is three days. a. Calculate and interpret the Economic Order Quantity (EOQ). b. At what inventory level should Hamid Company place another order. Interpret.
= $ 15, Assume that D = 5,000, k = $ 186, c = and five setups (orders) are required per year. What is the percentage per unit per year of the implicit cost of holding inventory? (result in percentage)
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EOQ? CALCULATE
Julekha conversion period of 50 days, an average cullecuion period (DSO) uf 35 lays, and a payables deferral period of 25 days. Assume that cost of goods sold is 80% of Enterprises has an inventory sales. Julekha's annual cost of labour is Tk.550,00N) and annual cost of materials is Tk.750,000. ASsume a year = 360 days. a. What is the length of the firm's cash conversion cycle? b. II annual Sales Negus' Tk.4,380,(00) and all sales are on credit, what is the fim's investment in dCCDunts recrivahle? c. How many times per year does Negus Enterprises turn over its inventory? d. How much working capital linancing does Negus have to ensure to complete the cash convPision cycle are
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Q1// A company estimates that it will sell 12000 units of its product for the forthcoming year. the ordering cost is 100 $ per order and the carrying cost per year is 20% of the purchase price per unit. The purchase price per unit is 50$. Find: Economic Order Quantity, No. of orders/year and time between successive order.