Answer:
Total cost = Total ordering cost + Total holding cost
Total cost = DCo + QH
Q 2
Where
D = Annual demand
Co = Ordering cost per order
Q = EOQ
H = Holding cost per item per annum
D = 40,000 units
Co = $48
H = 18% x $8.00 = $1.44
EOQ = √2DCo
H
EOQ = √2 x 40,000 x $48
$1.44
EOQ = 1,633 units
Explanation:
EOQ equals 2 multiplied by annual demand and ordering cost divided by holding cost per item per annum. The holding cost per item per annum is calculated as holding cost rate multiplied by unit cost.
Answer:
A) 964,286
B) 14
C) 750,000
Explanation:
The portfolios expected return = (0.5 x $70,000) + (0.5 x $200,000) = $35,000 + $100,000 = $135,000
If the risk free investment yields 6% per year, and you require a risk premium of 8%, then the total interest rate that the portfolio yields must be 6% + 8% = 14%
you will be willing to pay: $135,000 / 14% = $964,286 for the portfolio
if the risk premium increase by 4%, then the price of the portfolio will decrease to: $135,000 / 18% = $750,000
Answer:
Explanation:
Last year Current year
Selling Price 10 10
Varaible Price 5 6
Contribution Margin 5 4
Break even is the point where total cost is equal to total revenue mean no profit and loss.
company earns the contribution margin after covering the variable cost, now only fix cost remains for break even.
Break Even using FIFO method : first In first out system
Fix Cost = 86000
contribution from opening units(6000*5) = 30000
Remaining Fix cost that should be Covered from
current year products = 56000
Units to be sold for break-even ( 56000/4) = 14000
so we have break even units 6000+14000 = 20000
Fix cost = -86000
Opening 6000*5 = 30000
Current 14000*4 = 56000
Profit = 0
Break Even using LIFO method : Last in first out
Fix Cost = 86000
Break even = Fix Cost / Contribution margin
Break even = 86000/4 =21500
current production is 24000 which is higher than break even units so we can cover the fix cost from current year production because company is using lifo method. we do not need opening units for the break even.
Answer:
I feel like something is wrong in the question. Can you check it again?
Explanation:
Answer:
the fastest we could drop your price before your monthly revenue starts to drop is $2,000
Explanation:
Data provided in the question:
Cars sold per month, Q = 70 cars
Price of each car, P = $35,000
Rate of increase in demand, 
= 4 cars per month
Now,
Revenue, R = Price(P) × Quantity (Q)
Thus,
When monthly revenue starts to drop i.e 
< 0
⇒ = 
< 0
or
⇒ 
< 0
or
⇒ 
< 0
or
⇒ 
< - 140,000
or
< - 2,000
Hence,
the fastest we could drop your price before your monthly revenue starts to drop is $2,000
