[item no.14] A company uses the production run model to determine the number of t-shirts that must be produced per production run. The cost per t-shirt is P150. The holding cost is P5 per unit per year and the cost of setting up the production line is Php1,500 per setup. The production rate is 250 per day and the daily demand rate is 100 units. The optimal production quantity per production run is 5000 units. What is the total annual cost (including unit cost)? a. Php 3.75 million b. Php 376,500 c. Php 3.765 million d. Php 15,000
[item no.14] A company uses the production run model to determine the number of t-shirts that must be produced per production run. The cost per t-shirt is P150. The holding cost is P5 per unit per year and the cost of setting up the production line is Php1,500 per setup. The production rate is 250 per day and the daily demand rate is 100 units. The optimal production quantity per production run is 5000 units. What is the total annual cost (including unit cost)?
a. Php 3.75 million
b. Php 376,500
c. Php 3.765 million
d. Php 15,000
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Inventory management is described as the process or means through which the inventory produced by a manufacturing business is controlled and tracked. The management of the inventory is carried out as soon as the items are brought into a warehouse, after goods are manufactured, and dealing with storage and usage of finished goods. It is important to mention that companies manage their inventories to conduct sales of goods.
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