Calculate the annual economic order quantity from the attached provided below GM Electronics expects to sell 800 alarm systems each month of 2022 at R4 000 each. The cost price of eachalarm system is R2 000. The inventory holding cost of an alarm system is 1% of the unit cost price. The cost ofplacing an order for the alarm systems is estimated at R60.

Economic order quantity - EOQ = square root of 2 ×(annual demand × ordering cost) / annual…

to sell 800 alarm systems each month of 2022 at R4 000 each. The cost price of each The inventory holding cost of an alarm system is 1% of the unit cost price. The cost of alarm systems is estimated at R60.

to sell 800 alarm systems each month of 2022 at R4 000 each. The cost price of each The inventory holding cost of an alarm system is 1% of the unit cost price. The cost of alarm systems is estimated at R60.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 10Q: If the sales forecast estimates that 50,000 units of product will be sold during the following year,...

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Calculate the annual economic order quantity from the attached provided below

GM Electronics expects to sell 800 alarm systems each month of 2022 at R4 000 each. The cost price of each
alarm system is R2 000. The inventory holding cost of an alarm system is 1% of the unit cost price. The cost of
placing an order for the alarm systems is estimated at R60.

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