The XYZ company has traditionally ordered ink refills 80 units at a time. This company estimates that carrying cost is $ 5 /unit/year; and that annual demand is about 400 units per year. Question: for what valuo of the ordering cost (i,o., cost/order) would the curront order quantity be optimal? Show all the details of your calculations to get full marks.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 9EB: The cost data for BC Billing Solutions for the year 2020 is as follows: Using the high-low method,...
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The XYZ company has traditionally ordered ink refills 80 units at a time. This company estimates that
carrying cost is S 5 /unit/year; and that annual demand is about 400 units per year.
Question: for what value of the ordering cost (i.e., cost/order) would the current order quantity be
optimal? Show all the details of your calculations to get full marks.
Transcribed Image Text:The XYZ company has traditionally ordered ink refills 80 units at a time. This company estimates that carrying cost is S 5 /unit/year; and that annual demand is about 400 units per year. Question: for what value of the ordering cost (i.e., cost/order) would the current order quantity be optimal? Show all the details of your calculations to get full marks.
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