Which one of the following groups of items best identifies various types of inventory opportunity costs? Multiple Choice Inventory obsolescence, warehouse rent, opportunity cost of capital utilized, insurance premium on inventory. Insurance premium
Which one of the following groups of items best identifies various types of inventory opportunity costs?
Multiple Choice
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Inventory obsolescence, warehouse rent, opportunity cost of capital utilized, insurance premium on inventory.
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Insurance premium on inventory, cost of equipment setup for production run, cost of inventory clerk, inventory theft.
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Warehouse rent, insurance premium, inventory obsolescence, reorder costs.
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Cost of inventory tracking system, cost of forklift driver to move inventory, cost of accounts payable clerk to process bills from suppliers, insurance premium on inventory
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Cost of inventory clerk, cost of forklift driver to move inventory, cost of clerk to reorder inventory, cost of machine operator to set up a production run.
2.
Quidi Vidi Co. has 325 motors in its inventory at the start of the week. It will use all of these in its weekly production runs and then resupply its inventory for the next week. The carrying cost per motor is $84.26. The fixed cost per order is $63. The variable cost per motor is $122.
What is the total carrying cost of the motor inventory?
Multiple Choice
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$6,133
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$13,692
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$19,825
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$27,385
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$33,157
3.
Your firm currently has a cash sales only policy. Under this policy, you sell 340 units a month at a price of $120 a unit. Your variable cost per unit is $94 and your carrying cost per unit is $1.80. The monthly interest rate is 1.5 percent. You think that you can increase your sales to 600 units a month if you institute a net 30 credit policy. What is the
Multiple Choice
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$262,103
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$333,333
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$385,427
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$414,141
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$447,009
72.
Currently, your firm sells 370 units a month at a price of $560 a unit. You think you can increase your sales by an additional 100 units if you switch to a net 30 credit policy. The monthly interest rate is.5 percent and your variable cost per unit is $340. What is the net present value of the proposed credit policy switch?
Multiple Choice
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$4,001,900
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$4,008,100
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$4,158,800
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$4,560,600
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$4,641,200
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