Manar Enterprises manufactures a product A. The following particulars are given for Material X used for producing product A for the year 2021 Monthly demand of 5000 units · Cost of placing an order OMR 75 · Annual carrying cost per unit OMR 125 Storage cost = 20 % • Normal usage 600 units per week • Maximum usage 700 units per week • Minimum usage 400 units per week · Reorder period 4 to 6 weeks Compute from the above: (а) ЕOQ (b) Reorder level, (c) Minimum level,
Manar Enterprises manufactures a product A. The following particulars are given for Material X used for producing product A for the year 2021 Monthly demand of 5000 units · Cost of placing an order OMR 75 · Annual carrying cost per unit OMR 125 Storage cost = 20 % • Normal usage 600 units per week • Maximum usage 700 units per week • Minimum usage 400 units per week · Reorder period 4 to 6 weeks Compute from the above: (а) ЕOQ (b) Reorder level, (c) Minimum level,
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Manar Enterprises manufactures a product A. The
following particulars are given for Material X used for
producing product A for the year 2021
Monthly demand of 5000 units
• Cost of placing an order
OMR 75
· Annual carrying cost per unit OMR 125
Storage cost = 20 %
• Normal usage
600 units per week
• Maximum usage
700 units per week
• Minimum usage
400 units per week
Reorder period
4 to 6 weeks
Compute from the above:
(а) EOQ
(b) Reorder level,
(c) Minimum level,
(d) Maximum level,
(e) Average stock level.
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