The Allianz Company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Relevant ordering costs per purchase order $510 Relevant carrying costs per year for each product: Required annual return on investment 15% Required other costs per year $7 Annual demand is 30,000 products per year. The purchase price per product is $50. What is the annual relevant carrying costs?
The Allianz Company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Relevant ordering costs per purchase order $510 Relevant carrying costs per year for each product: Required annual return on investment 15% Required other costs per year $7 Annual demand is 30,000 products per year. The purchase price per product is $50. What is the annual relevant carrying costs?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
The Allianz Company produces a specialty wood furniture product, and has the following information available concerning its inventory items:
|
Relevant ordering costs per purchase order
|
$510
|
|
Relevant carrying costs per year for each product:
|
|
|
Required annual
|
15%
|
|
Required other costs per year
|
$7
|
Annual demand is 30,000 products per year. The purchase price per product is $50. What is the annual relevant carrying costs?
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