The Best Furniture company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Ordering costs per purchase order Carrying costs per year P15,000 P300 per unit Annual demand is 20,000 packages per year. The quantity per order equals 1,000 units. What is the total annual ordering and holding costs? P450,000 P25,000 P300,000 P150,000

The Best Furniture company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Ordering costs per purchase order Carrying costs per year P15,000 P300 per unit Annual demand is 20,000 packages per year. The quantity per order equals 1,000 units. What is the total annual ordering and holding costs? P450,000 P25,000 P300,000 P150,000

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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Question

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The Best Furniture company produces a specialty wood furniture product, and has
the following information available concerning its inventory items:
Ordering costs per purchase order
Carrying costs per year
P15,000
P300 per unit
Annual demand is 20,000 packages per year. The quantity per order equals 1,000 units.
What is the total annual ordering and holding costs?
P450,000
P25,000
P300,000
P150,000

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