Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 60,500 units per year, an ordering cost of $12 per order, and carrying costs of $1.20 per unit. a. What is the economic ordering quantity? ___________Units b. How many orders will be placed during the year? __________Orders c. What will the average inventory be? ____________Units d. What is the total cost of ordering and carrying inventory? $____________

Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 60,500 units per year, an ordering cost of $12 per order, and carrying costs of $1.20 per unit. a. What is the economic ordering quantity? _Units b. How many orders will be placed during the year? Orders c. What will the average inventory be? Units d. What is the total cost of ordering and carrying inventory? $____

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 7E: Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The...

See similar textbooks

Related questions

Q: Emil Traders, Inc. sells cellphone cases which it buys from a local manufacturer. Emil Traders sells…

A: Economic order quantity is the optimal order size given certain costs and quantities that a company…

Q: Manitoba Transport collects 75% of its monthly sales immediately and the rest at the end of the…

A: Break-Even Sales - Break-even sales defined as the sales at which the company covers only the…

Q: es 250 day

A: Minimum level of stock refers to the minimum amount of quantity of raw Material which is required to…

Q: Walker Entertainment is a distributor of video games and expects its video game sales to be as…

A: February cost of goods sold = February sales x 70% = $150,000 x 70% = $105,000 March cost of goods…

Q: Nowlin Pipe & Steel has projected sales of 19,600 pipes this year, an ordering cost of $5 per order,…

A: a. Economic Order Quantity = (2S0 / C)1/2 where, C = carrying cost per unit S = total demand in…

Q: A supermarket uses a supplier for its bottled water. The annual demand for this product is 24000…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: For next year, if the expected sales quantity is 5,000 units, what is the number of units needed to…

A: Expected sales xxx Add quantity needed in ending inventory xx Total quantity required for the period…

Q: Samantha Ross is the procurement manager for the headquarters of a large Financial company chain…

A: Given that, Annual demand (A) = 7000 units per year Cost per unit = $120 Holding cost per unit (C) =…

Q: You have just been appointed as financial manager of Slow-Moving-Stock Limited. One of your main…

A: Inventory Turn Over ratio :— The inventory turnover ratio formula is equal to the cost of goods sold…

Q: Green Tees, an on line retailer of t-shirts, orders 100,000 t-shirts per year from its manufacturer.…

Q: Samsung uses 600 touch-screen glasses a month to manufacture cell phones. Each touch screen-glass…

A: If the company is using 600 units a month so it will order units every month. Therefore, number of…

Q: Dream Corporation is trying to improve its inventory control system and has installed an online…

A: Economic Order Quantity represents the optimal quantity to be purchased while placing every order…

Q: A. Genesis Company is a wholesaler. It purchases 60,000 units of Product X per month for sale to…

A: Hi student Since there are multiple questions, we will answer only first question. Since first…

Q: A supermarket uses a supplier for its bottled water. The annual demand for this product is 24000…

A: Inventory cycle time is determined by dividing the number of working days by the number of orders.…

Q: Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer…

A: When involved in the production of certain goods, it is necessary to keep a record of the demand for…

Q: Company B is a retailer of mobile phones in Australia that works 250 days in a year. The manager is…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: If last year's sales were $906,050 and a store was planning an increase in sales of 3.75% and a…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: a. Calculate the average aggregate inventory value. b. Calculate the inventory turnover. c. The…

A: As per the honor code, we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit…

Q: What is the economic ordering quantity for chips?

A: The optimum units of any given product that must be ordered such that its ordering and holding…

Q: Green Tees, an on line retailer of t-shirts, orders 10,000 t-shirts per year from its manufacturer.…

A: Optimal order quantity is also called economic order quantity and is the most cost-effective amount…

Q: Meijer stores carries a specialty line of flavored syrups. One of the most popular of these is…

Q: A local retailer anticipates an annual demand 15000 units of a product. The retailer allows…

A: Every business operation has to fulfill the demand of inventory without any shortage. So in this…

Q: Nowlin Pipe & Steel has projected sales of 6,400 pipes this year, an ordering cost of $5 per order,…

A: The conceptual formula used:

Q: A company starts the year with twenty units of inventory costing $20 each. In January, ten of these…

A: Particulars Units Price per unit Total value Beginning inventory 20 $20 $400…

Q: Millen’s managers have made the following additional assumptions and estimates Estimated sales for…

A: ACCOUNT RECEIVABLE; An account receivable is defined as it is money that has not been paid by…

Q: Corey's Campus Store has P50,000 of inventory on hand at the beginning of the month. During the…

A: The inventory refers to the items and merchandise meant to be sold in order to earn profit. The…

Q: You are in charge of inventory control of a highly successfulproduct retailed by your firm. Weekly…

A: Since you have posted a question with multiple subparts, we will solve first three subparts for you.…

Q: Delta’s policy is to keep 20% of next month’s sales in ending inventory. If sales in April are…

A: Units that should be produced in April = Expected units to be sold in April + Required Ending…

Q: Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer…

A: Ending inventory refers to the value of inventory lying with the entity at the end of the accounting…

Q: A local retailer anticipates an annual demand 12000 units of a product. The retailer allows…

A: Economic order quantity the order quantity company should purchase to minimize the ordering,…

Q: Millen’s managers have made the following additional assumptions and estimates: Estimated sales for…

A: The operating cycle refers to the whole process cycle, begins with purchasing and ends with a…

Q: Cheeseburger and Taco Company purchases 19,634 boxes of cheese each year. It costs $21 to place and…

A: Given: Particulars Cheese boxes 19634 Ordering cost 21 Inventory cost 3.74

Q: Samantha Ross is the procurement manager for the headquarters of a large Financial company chain…

A: This question will be solved using the EOQ (Economic Order Quantity). EOQ is the ideal order…

Q: Quick-Copy Duplicating Company uses 110,000 reams of standard-size paper a year at its various…

A: Calculation of Economic Order Quantity (EOQ): Annual requirement of raw material (A) = 110,000 reams…

Q: Suppose that the R&B Beverage Company has a soft drink product that shows a constant annual demand…

A: Economic order quantity (EOQ) is a computation that businesses use to determine their ideal order…

Q: Dream Corporation is trying to improve its inventory control system and has installed an online…

A: The inventory control system is a type of technological solution that helps in managing and tracking…

Q: A supermarket uses a supplier for its bottled water. The annual demand for this product is 24000…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Question

b. How many orders will be placed during the year?

__________Orders

c. What will the average inventory be?

____________Units

d. What is the total cost of ordering and carrying inventory?

$____________

Processes and procedures involved in achieving the organizational goals and objectives for the daily operations of a company. Control systems involve all the operational control systems, their implementation, and strategic control processes.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1 : Introduction

VIEW

Step 2: Economic Order Quantity

VIEW

Step 3: Orders placed during the year

VIEW

Step 4: Average Inventory

VIEW

Step 5: Total cost

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 5 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Nowlin Pipe & Steel has projected sales of 19,600 pipes this year, an ordering cost of $5 per order, and carrying costs of $1.60 per pipe. a. What is the economic ordering quantity? Economic ordering quantity b. How many orders will be placed during the year? Number of orders orders c. What will the average inventory be? Average inventory units units
Dream Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Howe anticipates sales of 126,000 units per year, an ordering cost of P4 per order, and carrying costs of P1.008 per unit. The following year, the company. learns it can reduce ordering costs to P1 per order but that carrying costs will stay the same at P1.008 per unit. What is the total cost of inventory to be expected?
Nowlin Pipe & Steel has projected sales of 6,400 pipes this year, an ordering cost of $5 per order, and carrying costs of $1.60 per pipe.a. What is the economic ordering quantity? b. How many orders will be placed during the year? c. What will the average inventory be?
Please solve the following problems related to Inventory Management 1. A produce distributor uses 3700 packing crates per year. The manager has assigned an annual carrying cost of $8 per crate. Ordering cost is $30. (a) How much is the order quantity based on E0Q mode1? (b) How much is the total cost using E0Q ,mode1?
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.
A store sells a product that has the annual demand of 16,156 units. It purchases the product from supplier A for $74.4 per unit. The unit inventory carrying cost per year is 14 percent of the unit purchase cost. The cost to place and process an order from the supplier is $107 per order. Supplier A has a delivery lead time of 7 days. The store operates 300 days a year. Assume EOQ model is appropriate. What is the optimal total annual inventory and purchase cost for the store? Use at least 4 decimal places.
A retailer anticipates selling 3,000 units of its product at a uniform rate over the next year. Each time the retailer places an order for a units, it is charged a flat fee of $50. Carrying costs are S30 per unit per year. How many times should the retailer reorder each year and what should be the lot size to mınımize inventory costs? What is the minimum inventory cost? Use the formula ECQ to obtain your answers. They should order times a year units The minimum inventory cost is $
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…
a. Assume that the cost of goods sold is 60% and that the monthly discount rate is 1%. Looking at the values in the exhibit above, you note that the average monthly revenue for a subscribed customer rises as the company sends more emails. In addition, the average monthly revenue for an unsubscribed customer also rises as the company sends more emails. What could explain both of these patterns? b. Calculate the 6-month LTV for each of the four tested email frequencies. Please show the spreadsheet with your calculations and be clear about any assumptions you are making. c. Based on this test, how many emails-per-week should the company be sending to its customers? This email frequency should apply to all customers; the company doesn't want to implement a different email frequency for different kinds of people
Economic order quantity (EOQ). Tinnendo, Inc. believes it will sell 4 million zen-zens, an electronic game, this coming year. Note that this figure is for annual sales. The inventory manager plans to order zen-zens 46 times over the next year. The carrying cost is $0.04 per zen-zen per year. The order cost is $617 per order. It turns out that the marketing manager has underestimated the zen-zen market. The zen-zens are a smash, and current estimates are that the company will sell 8 million of them per year. Should the inventory manager simply double the EOQ order quantity? Find the new EOQ, and verify that it is the correct order quantity by finding the new carrying cost and new ordering cost. Should the inventory manager simply double the EOQ order quantity? (Select the best response.) A. Yes B. No What is the new EOQ? zen-zens (Round to the nearest whole unit.) What is the new annual carrying cost for the zen-zens? (Round to the nearest dollar.) What is the…
Jae's Shoes is considering a change of their current inventory control system for sneakers. The information regarding the neckties is: Demand = 1000 pairs/week; Lead time = 3 weeks; Order cost=$20/order; Holding cost= $10.00/pair/yr; Cycle service level = 95%; Standard deviation of weekly demand = 48; and Number of weeks per year = 52. To calculate the relative frequency use the following values: a) Units Sold and Number of Days b) Number of Days and Standard Deviation of Weekly Demand c) Units Sold and Demand d) Lead Time and Holding Cost
Green Tees, an on line retailer of t-shirts, orders 10,000 t-shirts per year from its manufacturer. The carrying cost is $0.10 per shirt per year. The order cost is $550 per order. What is the optimal order quantity for the t-shirt inventory (rounded to the nearest dollar)?