Economic order quantity, Cost Accounting

Economic Order Quantity

This constitutes the quantity purchased of either raw materials or stocks which is considered most optimum. It is the quantity such minimizes both ordering costs and holding costs, like the quantity of purchase rises there is a reduction in ordering costs, however a raise in holding costs as demonstrate in the graph below as:

2007_Economic Order Quantity.png

Net cost = Net ordering costs + Net holding costs

Net ordering costs = cost per order X no of orders in a period

Net holding cost = average stock quantity X holding cost per unit

Posted Date: 2/5/2013 5:14:15 AM | Location : United States







Related Discussions:- Economic order quantity, Assignment Help, Ask Question on Economic order quantity, Get Answer, Expert's Help, Economic order quantity Discussions

Write discussion on Economic order quantity
Your posts are moderated
Related Questions
what are the material management questions

10% of the finished castings were to be defective in manufacture and were rectified by expenditure of additional works overhead charges to the extent of 20% on the proportionate di

sabonis consmetics co. purchased machinery on december 31,2011, paying $50,000 down and agreeing to pay the balance in four equal installments of $40,000 payable each dec 31. an as

Accounting for Job Order Costing - Direct Materials Direct materials (i) Dr Stores ledger control Account Cr Cash Account - for cash purchasers              X (ii) D

Tracking Direct Materials Jack keeps full records of the material released to each job. When Donnie gathered up light bulbs, tape, breakers, wire, and wire nuts on the morning

the folloeing job order cost sheets were purchased for three jobs that were in production during january job 97 job 98 job 99 material

what is regression analysis and its applicability to the course of cost accounting

This is difficult to perceive cash maintained in the vault as an investment. Fairly, you would be thinking that if we invest cash, then how can cash itself be an investment? Howeve

behabioural aspect of standard costing on budget

Igor and Angela were married in 2005, separated in 2011, and divorced recently. At the time of marriage, each had some investments and personal assets. They both worked during the