The following are the annual costs of Peter Corp. relating to Material A which required 40,000 units per year:   Unit Cost Insurance cost $20 Storage cost 32 Freight in 36 Order cost 10 Interest that could have been earned on the alternative investment of funds $320,000 What is the annual carrying cost per unit?

Principles of Accounting Volume 2
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ISBN:9781947172609
Author:OpenStax
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Chapter11: Capital Budgeting Decisions
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Problem 1PA: Your company is planning to purchase a new log splitter for is lawn and garden business. The new...
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The following are the annual costs of Peter Corp. relating to Material A which required 40,000 units per year:

  Unit Cost
Insurance cost $20
Storage cost 32
Freight in 36
Order cost 10

Interest that could have been earned on the alternative investment of funds $320,000

What is the annual carrying cost per unit?

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