A company makes and sells keyboarc
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company makes and sells keyboards
for $1000 each. The annual
holding cost is 10%. of the sale price.
Annual demand is 10,000 units.
The company is open 300 days of the
year and can make 60 keyboards
per day. The order setup cost is $150 per
order. Determine the
following:
1. The economic order quantity.
2. The production downtime.
3. The number of orders/year.
4. The order cycle
5. The annual ordering cost.
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