What is the annual cost for storing item x

Assignment Help Finance Basics
Reference no: EM131146425

The X is a standard item stocked in a company's inventory of component parts. Each year the firm, on a random basis, uses about 2,000 of item X, which costs $25 each. Storage costs, which include insurance and cost of capital, amount to $5 per unit of average inventory. Every time an order is placed for more item X, it costs $10.

a. Whenever item X is ordered, what should be the order size?

b. What is the annual cost for ordering item X?

c. What is the annual cost for storing item X?

The X is a standard item stocked in a company as inventory of component parts. Each year the firm, on a random basis, uses about 2,000 of item X, which costs $25 each. Storage costs, which include insurance and cost of capital, amount to $5 per unit of average inventory. Every time an order is placed for more items X, it costs $10.

a. Whenever item X is ordered, what should be the order size?

b. What is the annual cost for ordering item X?

c. What is the annual cost for storing item X?

Reference no: EM131146425

Accepting or rejecting the offer

Suppose you have 500 acres of timberland, with young timber worth $40,000 if logged now. This represents 1,000 cords of wood worth $40 per cord net of costs of cutting and hau

What is the expected total annual variable costs

The Grist Mill estimates it can sell 600 pairs of shoes a year, plus or minus 2 percent. It also estimates the variable cost at $31 per pair, plus or minus 3 percent. What i

Tvm-compounding and discounting

Find out the present value of $2,000 received at the end of each year for next 15 years at a discount rate of 7%? How are the processes of discounting and compounding related?

Differences between the cost and sales comparison approaches

Why is the income approach to value often difficult to use on a single-family residential appraisal?- What are the differences between the cost and sales comparison approaches

Discuss whether you would recommend registering

Discuss whether you would recommend registering these securities with the Securities and Exchange Commission. Some securities are exempt from the SEC registration requirement.

Intention of maintaining a constant dividend

Giraldo's Bass and Pro Shops offer a common stock that pays an annual dividend of $2.00 a share. The company has every intention of maintaining a constant dividend. How mu

Miller and modigliani model

According to the Miller and Modigliani model dividened policy is irrelevant. However, there are numerous factors in the real world that violate the MM assumptions.

Evaluating the var in a historical simulation

National Bank Asia desire to employee fresh young graduates to work in their Market Risk Management department. As you are preparing your interview,

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd