Problem 1 The Norman Company predicts that 64,000 units of material will be used during the year. The materials are expected to cost P20.00 per unit. It is anticipated that it will cost P 40.00 to place each order. The annual carrying cost is P 2.00. Determine: a. The most economical order quantity b. The total cost of ordering and carrying at the EOQ point

Problem 1 The Norman Company predicts that 64,000 units of material will be used during the year. The materials are expected to cost P20.00 per unit. It is anticipated that it will cost P 40.00 to place each order. The annual carrying cost is P 2.00. Determine: a. The most economical order quantity b. The total cost of ordering and carrying at the EOQ point

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Q3The ABC Company manufactures three products – product X, product Y and product Z. The variable expenses and sales prices of all the products are given below: Product X Product Y Product Z Sales per Unit Variable cost per Unit 300 200 400 150 100 200 The total fixed expenses of the company are OMR 90,000 per month. For the coming month. ABC expects the sale of three products in the following ratio: Product X: 20%; Product Y: 40%; Product Z: 40% Required: Compute the break-even point of ABC company in units and OMR for the coming month.
3. Buildz Manufacturing currently produces 1,000 tables per month. The following per unit data for 1,000 tables apply for sales to regular customers: Direct materials £50 Direct manufacturing labor Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing costs 10 15 30 £105 The plant has capacity for 3,000 tables and is considering expanding production to 3,000 tables. What is the total cost of producing 3,000 tables? A) £255,000 B) £225,000 C) £175,000 D) £235,000
Question No. 1-1 The HASF Company has an annual plant capacity of 50,000 units. Predicted data on sales and costs are given below. Sales (50 per unit) 1,000,000 Manufacturing cost Variable (material labor and overhead) 40 per unit Fixed overhead 30,000 Selling and administrative expenses Variable (sales commission RS 0.5 per unit) 2 per unit Fixed 7,000 A special order has been received from outside for 5,000 units at a selling price of 45 per unit this order will no effect on regular sales. The usual sales commission on this order will be reduced by one half. Required: Should the company accept / reject the order? Keeping in view the above answer narrate rationale to support your answer
Answer all subparts a,b,c,d,e,f.if answered within 30mins,it would be great Accounting ETS manufactures a component for its computer products. The annual demand for thiscomponent is 2500 units. The annual cost of maintaining inventory is10% per unit and the cost of preparing an order and setting up productionfor the order is $ 50.The machine used to make this part has a production rate of 10,000units per year and the cost is $ 22 per unit.a. Find the EPQ(Economic Production Quantity)A. How long does it take to produce the batch?B. How many batches will be produced per year?C. What is the maximum inventory level?D. What is the total cost per year?E. A supplier offers to sell a similar component for $ 25 per unit with a charge$ 5 per service per order. Should the company accept the offer?F. Find the average inventory level for each situation
compute for throughput time
Help solve all questions AXY LTD company is planning to use the economic order quantity model to determine the optimal order levels of raw materials. Material Z is consumed evenly over the year and the current usage is 120,000 units of a particular item in the year ahead. The item is purchased in boxes and each box containing 12 units of the material Z, at a price of RM252 per box. A safety inventory of 250 boxes is kept. The cost of placing and handling orders is estimated to be RM6,300, which is based cost incurred for similar orders that have already made. The cost of RM6,300 was for 30 orders. The inflation of 2 per cent should be added to the above ordering costs. Besides, the company estimates to be charged the transporation cost of RM15 per order. It should be assumed that ordering costs change in proportion to the number of orders place. Other costs which relate to material Z such as insurance, interest and space costs for a year, were calculated at 15 % of the purchase price.…
Question 1 A manufacturing company, VMTC PLC, makes the product, blitz. Monthly sales for the first five months of 2022 have been estimated as: Month Units January 210 000 February 180 000 March 210 000 April 220 000 May 200 000 Additional Information: i. Actual units sold in 2021 November and December were 190 000 and 220 000, respectively. ii. One unit of blitz requires 2 kg of material at $3.50 per kg. iii. One unit of blitz requires half an hour of direct labour at a rate of $12 per hour. iv. Based on past experience, 60% of cash is received in the month of sale, 25% the following month, 10% two months after and 5% is usually irrecoverable. V. Selling price is $18 per unit. vi. The company intends to have finished stock at the end of each month equivalent to 15% of the following month's budgeted sales. The policy regarding stock of raw materials is to have 25% of the following month's production requirements. vii. Stocks at 2022 January 01 are estimated to be 22 000 units of…
Selling price Materials cost GH¢20 per unit 3 kg per unit at GH¢2.5 per kg 0.6 hours per unit at GH¢4 GH¢1.2 per unit Labor cost Direct expenses Sales in May, June and July, 2021 are forecast to be 12,000 units in cach of the three months. As a direct result of marketing expenditure of GH¢8,000 in August 2021, sales are expected to be 11,000 units in August 2021, and to increase by 10% in cach month from September to December, 2021. Sales after December 202i are expected to remain at the December 2021 level. From business history, the management of Comfort Ltd has determined the following to be the pattern by which sales revenues are received: Twenty-five percent (25%) of sales are received in the month during which the sales occur; 30% of sales are received in one month following the month of sale; 30% of sales are received in two months following the month of sale; and 12% of sales are received in the third month following the month of sale. The remaining percentage of sales revenue…
Q.4 Standard cost systems provide companies with a number of advantages, argue the statement. Following are the details of Abbass Industries for the period ended June 30, 2020. Company establish standard on its normal capacity of 120,000 units/hours in a year: Direct Material 600,000 kgs at Rs. 9 per kg Direct Labor 4 hours per unit at Rs. 6 per hour Factory overhead: Fixed cost Rs. 240,000 per year or Rs. 20,000 per month. Variable Cost Rs. 4.50 per hour. During the one month of operation, company produced 11,000 units. Direct material used: 60,500 kgs at Rs. 9.10 per kg Direct labor used:…
Question 1 BARTELS Limited expects to sell 8,200 mobile phones this year. The cost of placing an order from its supplier is GH¢200. Each phone costs GH¢600, and carrying costs are 20% of the purchase price. Currently, they order 250 mobile phones at a time. They are however not sure if this is efficient. You have been tasked to help. a. Provide them with an optimal order quantity (round to the nearest whole) b. What savings will accrue to BARTELS Ltd as a result of the switch? c. Based on the EOQ, how many order cycles will BARTELS have for the year? d. If daily demand is 20 mobile phones with a lead time of 2 days and safety stock of 20 phones, what is the Reorder point for Cool Ltd?
32.This is Cost Accounting. Explain briefly and answer. The following information pertains to Lannister Manufacturing Corporation’s Product Y: Annual Demand 33,750 units Annual cost to hold one unit of inventory P15 Setup cost (or the cost to initiate a production run) P500 Beginning Inventory of Product Y - 0 - At present, the company produces 2,250 units of Product X per production run, for a total of 15 production runs per year. The company is considering to use the EOQ model to determine the economic lot size and the number of production runs that will minimize the total inventory carrying cost and setup cost for Product Y If the EOQ model is used, what should be the number of production runs? (round to whole number)
Total cost and number of units in the first seven months of 2020 are given below. According to this information, which of the following is the cost equation? Periods Total Cost No.of Units January 21,410 210 February 22,040 240 March 22,775 275 April 23,195 295 May 23,510 310 June 23,720 320 July 24,350 350 Select one: a. Y=17000+21*X b. Y=20500+23*X c. Y=20000+22.5*X d. Y=23150+25*X