EOQ and inventory cost. Horthern Appliance store sells about 375 console model 25-inch televsion sets per year. The price of the sets is $800 and the unit cost the store $600 each. Cost of ordering are $125 per order and carrying costs are 25 percent of unit cost, comprised mostly of insurance and financing costs for inventory. Required: a) Compute the economic order Quantity b) Compute the total cost of the inventory
EOQ and inventory cost. Horthern Appliance store sells about 375 console model 25-inch televsion sets per year. The price of the sets is $800 and the unit cost the store $600 each. Cost of ordering are $125 per order and carrying costs are 25 percent of unit cost, comprised mostly of insurance and financing costs for inventory. Required: a) Compute the economic order Quantity b) Compute the total cost of the inventory
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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EOQ and inventory cost. Horthern Appliance store sells about 375 console model 25-inch televsion sets per year. The price of the sets is $800 and the unit cost the store $600 each. Cost of ordering are $125 per order and carrying costs are 25 percent of unit cost, comprised mostly of insurance and financing costs for inventory.
Required:
a) Compute the economic order Quantity
b) Compute the total cost of the inventory
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