What is the average cost? A company's holding cost is 16% per year. Its annualinventory turns are 10. The company buys an item for$40.What is the average cost in dollars (rounded to twodecimal places) to hold each unit of this item ininventory?

Step 1: Definitions of Key ConceptsConcept of Holding Cost:Holding cost, also known as carrying…

Answered: A company's holding cost is 16% per…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 10MC

See similar textbooks

Similar questions

Hirt Corporation sells its product for $12 per unit. Next year, fixed expenses are expected to be $290,000 and variable expenses are expected to be $10 per unit. How many units must the company sell to generate net operating income of $69,000?(Financial Account)
Bohr Paint Company has annual sales of $12 million per year. If there is a profit of $5000 per day with 7 days per week operation, what is the total yearly business expense? All calculations are on a before-tax basis.
What is the company's estimated EOQ on these general accounting question?
what is the net income for one year?
A company buys 2mm items for $3 each and sells 1mm of those items during a year for $6 each. Marketing expenses are $200k for the year. The company has $3mm of debt with a 5% interest rate. Its depreciation expense for the year is $100k. The company’s income tax rate is 30%. Create an income statement for the company. Also, what is EBITDA?
Suppose that there is a customer expected to annually generate $1,500 of gross contribution. With 10% of annual discount factor, the NPV of the expected profits for the next THREE YEARS from this customer is about A) $4,500 B) $4,103 C) $5,462 D) $3,730
Suppose you sell8000 of the 3 pack of lenses in one year. your cost on each 3 pack is $29.95 and you sell them for $59.95 .If your operating expenses for the year total is $144,080,what are your net income and net profit margin percentage?
What is the net income for the year?
a. what is the EOQ for a firm that sells 5,000 units when the cost of placing an order is $5 and the carrying cost are $3.50 per unit? b. how long will the EOQ last? how many orders are placed annually? c. as a result of lower interest rates, the finnancial manager determines the carrying cost are now $1.80 per unit. what are the new EOQ and annual number of objects?
Felton Co. produces rubber bands for commercial and home use. Felton reported $1 million residualincome (RI) with $20 million net book value (NBV) of assets and $5 million in operating income forthe year. What was the required rate of return?
suppose you sell 8,000 of the 3 pack lenses described in question 3 above in one year. You cost on each 3 pack is $29.95 and you sell them for $59.95. if your operating expenses for the year total $144.080, what are your Net Income and Net profif margin percentage?
Assume a company sold 28,000 units last year and ncrease the sales commission by $2 per unit. What does this mean

SEE MORE QUESTIONS

Recommended textbooks for you

Intermediate Financial Management (MindTap Course…

Finance

ISBN:

9781337395083

Author:

Eugene F. Brigham, Phillip R. Daves

Publisher:

Cengage Learning

Entrepreneurial Finance

Finance

ISBN:

9781337635653

Author:

Leach

Publisher:

Cengage

Financial Accounting Intro Concepts Meth/Uses

Finance

ISBN:

9781285595047

Author:

Weil

Publisher:

Cengage

Intermediate Financial Management (MindTap Course…

Finance

ISBN:

9781337395083

Author:

Eugene F. Brigham, Phillip R. Daves

Publisher:

Cengage Learning

Entrepreneurial Finance

Finance

ISBN:

9781337635653

Author:

Leach

Publisher:

Cengage

Financial Accounting Intro Concepts Meth/Uses

Finance

ISBN:

9781285595047

Author:

Weil

Publisher:

Cengage

SEE MORE TEXTBOOKS

A company's holding cost is 16% per year. Its annual inventory turns are 10. The company buys an item for $40. What is the average cost in dollars (rounded to two decimal places) to hold each unit of this item in inventory?