anXTRM transistor. Expected demand is 10,000 units for the month of March1. Extreme Audio Inc. manufactures audio equipments. One component is20xx. Extreme Audio Inc. estimates the ordering cost per purchase order to beP475. The carrying cost for one unit of XTRM in stock is P9.50Required: a Compute the EOQ for the XTRM transistor.b. Compute the number of deliveries of XTRM in March 20xx

Annual demand = 10,000 units Ordering cost per purchase = P475 Carrying cost per unit = P9.50

Answered: XTRM transistor. Expected demand is…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 19P

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A supplier sells MF Tires to dealers. The annual demand is approximately1,000 tires. The supplier pays P50 for each tire and estimates that the annualholding cost is 20 percent of the total value of tires. It costs approximatelyP25 to place an order. The supplier currently orders 80 tires per month.Required:a. Calculate ordering, holding, and total inventory costs for thecurrent ordered quantity.b. Determine the EOQ.c. How many orders will be placed per year using the EOQ?d. Calculate ordering, holding, and total inventory costs for the EOQand also determine the change in total inventory cost.
A. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Required: 1. Compute the economic order quantity. 2. How many orders would be placed under the EOQ policy? 3. Compute the annual ordering cost for the EOQ. 4. Compute the annual carrying cost for the EOQ. 5. Compute the total inventory-related cost at the EOQ. 6. Previously, the company had been purchasing 5,000 units of product X per order: What is the ordering cost per year under the previous policy? ii. The annual carrying cost? iii. How much money does the company save over the policy of purchasing 5,000 units per order using the EOQ policy? i. B. Kings Company presents the following information: 1. Annual credit sales: P 25,200,000 2. Collection period: 3 months 3. Rate of return: 12% Kings company considers changing its credit term from n/30 to 3/10, 1/30. The following are…
‏The ABC Company consumes inventory of 67,500 units of components per year . The carrying cost per unit is RO 1.50 . The fixed order cost is RO 25 per order . The production planning is 365 - day year . a . What is the Economic Order Quantity ( EOQ ) ? Interpret . b . Calculate and interpret the optimal number of orders to be placed. c. If it takes five days to receive an order from suppliers, at what inventory level should ABC Company place another order? Interpret .
2. Hamid Company consumes inventory of 100,000 units of components per year. The carrying cost per unit is RO 3.50. The fixed order cost is RO 20 per order. The production planning is 365-day year. The delivery time is three days. a. Calculate and interpret the Economic Order Quantity (EOQ). b. At what inventory level should Hamid Company place another order. Interpret.
2. The ABC Company consumes inventory of 67,500 units of components per year. The carrying cost per unit is RO 1.50. The fixed order cost is RO 25 per order. The production planning is 365-day year. a. What is the Economic Order Quantity (EOQ)? Interpret. 219 S b. Calculate and interpret the optimal number of orders to be placed. the ida c. If it takes five days to receive an order from suppliers, at what inventory level should ABC Company place another order.Interpret.
Oster Company Ltd. manufactures dusk to dawn lamps. The following are the details of their operation during 2021: Average monthly market demand 2,000 lamps Ordering costs $ 200 per order Inventory carrying costs 20% per annum Cost of lamps $ 1000 per lamp Normal usage 100 lamps per week Minimum usage 50 lamps per week Maximum usage 200 lamps per week Lead time to supply 4 - 6 weeks Compute: What tradeoffs in costs are involved in computing the Economic Order Quantity?
4. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to retailers. The cost of placing an order is P100. The cost of holding one unit of inventory for one year is P4. Note: Kindly input your answer with comma. Example: 10,000 Required: a. Compute the economic order quantity. b. How many orders would be placed under the EOQ policy? c. Compute the annual ordering cost for the EOQ. d. Compute the annual carrying cost for the EOQ. e. Compute the total inventory-related cost at the EOQ.
The quarterly demand for an item of raw materials is estimated at 2,000 units at a purchase price of GH¢180 per unit. It is estimated that the cost per order will be GH¢270 and the cost of holding a unit of material in inventory will be GH¢24.Required:i. Compute the optimal order quantity, and total minimum costs.ii. Suppose a supplier offers 5% quantity discount for purchase of 8,000 units, should the offer be accepted
MM Co. expects total sales of P10,000. The price per unit is P5. The firm estimates an ordering cost of P7.50 per order, with an inventory cost of P0.70 per unit. What is the optimum order size? A. 147 units B. 207 units C. 327 units D. 463 units
The demand for products is 18,000 units. The ordering cost is 40 OMR per order and the holding cost is 10 riyals per unit per annual. The EOQ will be a. 335.41 b. 296.64 c. 282.84 d. 379.47
Electronics Company produced 300 transistors per day, which go into inventory. It supplies 150 transistors per day to Oman Radio. The annual demand is 37,500. The inventory holding cost is $0.25 per transistor per year and the setup cost per production run is $200. Find: А. ЕOQ В. Production run length = Q*/p С. Number of production runs per year = D/Q* Maximum inventory level
Based on an EOQ analysis (assuming a constant demand), the optimal order quantity is 2,500. The company desires a safety stock of 500 units. A 5-day lead time is needed for delivery. Annual inventory carrying costs equal 25% of the average inventory level. The company pays P4 per unit to buy the product, which it sells for P8. The company pays P150 to place a detailed order, and the monthly demand for the product is 4,000 units. Compute for the annual inventory carrying cost.

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