The following cost formula for total purchasing cost in a factory was developed using monthly data. Purchasing cost ¼ $123,800 þ ($15 3 Number of purchase orders) Next month, 2,000 purchase orders are predicted. The total cost predicted for the purchasing department next month a. is $2,000. b. is $153,800. c. is $30,000. d. is $123,800. e. cannot be determined from the above formula.
The following cost formula for total purchasing cost in a factory was developed using monthly data. Purchasing cost ¼ $123,800 þ ($15 3 Number of purchase orders) Next month, 2,000 purchase orders are predicted. The total cost predicted for the purchasing department next month a. is $2,000. b. is $153,800. c. is $30,000. d. is $123,800. e. cannot be determined from the above formula.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The following cost formula for total purchasing cost in a factory was developed using monthly data. Purchasing cost ¼ $123,800 þ ($15 3 Number of purchase orders) Next month, 2,000 purchase orders are predicted. The total cost predicted for the purchasing department next month
a. is $2,000.
b. is $153,800.
c. is $30,000.
d. is $123,800.
e. cannot be determined from the above formula.
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