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Stock-out costs
These are the opportunity costs of running out of stock. They comprise:
1) The costs of lost customer sales, and therefore lost contribution to fixed costs.
2) Potential loss of goodwill with customers whose demand cannot be net.
3 Acquiring emergency supplies at higher prices to meet demand.
4) Cost production of finished goods, where raw material stock-outs occur.
The computation of safety stocks lingers on demand forecasts. The manager will have some notion (usually based on past experience) of the range of daily demand. That is the probability that exists for usage of various quantities.
Pike Corporation paid $100,000 for a 10% interest in Salmon Corp. on January 1, 2010, when Salmon''s stockholders'' equity consisted of $800,000 of $10 par value common stock and
Decision Making Process Decision making is the process of choosing among alternatives. There are 7 steps that should be followed as shown in figure below: Figure:
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given the above data what would the breakeven in units and dollars be if u wanted a necessary after tax profit of $ 36,000 (assume a 30% tax rate ) units __________ ales dollars _
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