COST ACCOUNTING
INVENTORY AND PRODUCTION MANAGEMENT
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
Given EOQ is 250 units, because of customer need to choose the best Total Cost, what is the new EOQ for this formula if the 1st range is ( 1-100 ). Choose your answer below.
|
|
250
|
|
|
50
|
|
|
100
|
|
|
1
|
Explanation:
Detailed explanation-1: -Economic Order Quantity The total cost of inventory is the sum of the purchase, ordering and holding costs. As a formula: TC = PC + OC + HC, where TC is the Total Cost; PC is Purchase Cost; OC is Ordering Cost; and HC is Holding Cost.
Detailed explanation-2: -A number of orders per year = Annual quantity demanded/ EOQ.
There is 1 question to complete.