Calculate the eoq, Managerial Accounting

Calculate the EOQ

An agent supplies 1000 units per calendar month (PCM) OF A PRODUCT TO CONSUMER. The cost per unit is £175 and the amount cost of storage space is £40. Associated cost with Ordering/Re-ordering is £35 per order and interest rates are constant at 12.5% per year.

1. Calculate the annual holding cost of one unit

2. Calculate the EOQ.

3. Calculate the  annual number of re-orders necessary to satisfy the EOQ.

4. Draw a graph containing total cost, holding cost and re-ordering cost against order quantity and comment upon it. Use an order quantity range from 1 to 40 on your horizontal axis

5. Suppose now the EOQ was 3 unit less than your calculate EOQ. Calculate the cost penalty for deviating from the EOQ value by these 3 units.

Posted Date: 2/16/2013 1:08:48 AM | Location : United States

Related Discussions:- Calculate the eoq, Assignment Help, Ask Question on Calculate the eoq, Get Answer, Expert's Help, Calculate the eoq Discussions

Write discussion on Calculate the eoq
Your posts are moderated
Related Questions
Status Resources We had classified constraints as scarce and abundant, depending respectively on whether or not the optimum solution "consumes" the entire available amount of t

In the current corporate world, this is a common practice of companies along with surplus cash to lend to another company for a short period generally ranging from 60 days to 180 d

Explain about Cost centre: Meaning & definition: cost centre is defined as a location, person or item of equipment (or group of them) in respect which costs may be ascertaine

What are the Principles of management accounting? 1. The procedures and methods to be followed for keeping and analyzing financial statements should have consistency. It enable

Welcome to the Fall 2011 version of the comprehensive assignment prepared specifically for Accounting 294. Made up of 3 parts this assignment is meant to fulfil a number of obje

need help with a master budget and assumptions for project

Prisoner's Dilemma To understand the prisoner’s dilemma, let’s consider a story as follows: Two peoples are arrested for a crime. The police lack enough evidence to convict ei

Explain what is meant by traditional costing system. Support with example.

Cyclic Chains: In Markov Chains the current state of the system depends on all previous states. It is a stochastic process.  Sometimes transition probability matrices are diff