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Problem 1 The Norman Company predicts that 64,000 units of material will be used during year. The materials are expected to cost P20.00 per unit. It is anticipated that it cost P 40.00 to place each order. The annual carrying cost is P 2.00. Determine:

Problem 1 The Norman Company predicts that 64,000 units of material will be used during year. The materials are expected to cost P20.00 per unit. It is anticipated that it cost P 40.00 to place each order. The annual carrying cost is P 2.00. Determine:

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Chapter 7

Problem 1

Chapter 7 Accounting for Materials 203 PROBLEMS 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 2 The cost pE SMaterielA
Transcribed Image Text:Chapter 7 Accounting for Materials 203 PROBLEMS 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 2 The cost pE SMaterielA
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