1.) Caroline, the owner of Caroline's Boutique, Ltd., estimates that she will sell $20,000.00 worth of a certain decorator table this year. Her accountants have determined that ordering costs amount to $50.00 per year and that carrying costs amount to 25% of average inventory while the price of each unit is $500.00. Find the following: a) Optimal number of Orders per year, No; b) Optimal number of Days' supply per order, Nd; c) Optimal number of Dollars per order, Ns; d) Optimal number of Units per order, Nu.
1.) Caroline, the owner of Caroline's Boutique, Ltd., estimates that she will sell $20,000.00 worth of a certain decorator table this year. Her accountants have determined that ordering costs amount to $50.00 per year and that carrying costs amount to 25% of average inventory while the price of each unit is $500.00. Find the following: a) Optimal number of Orders per year, No; b) Optimal number of Days' supply per order, Nd; c) Optimal number of Dollars per order, Ns; d) Optimal number of Units per order, Nu.
Chapter18: The Management Of Accounts Receivable And Inventories
Section: Chapter Questions
Problem 21P
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Transcribed Image Text:1.) Caroline, the owner of Caroline's Boutique, Ltd., estimates that she will sell
$20,000.00 worth of a certain decorator table this year. Her accountants have
determined that ordering costs amount to $50.00 per year and that carrying costs
amount to 25% of average inventory while the price of each unit is $500.00. Find
the following:
a) Optimal number of Orders per year, No;
b) Optimal number of Days' supply per order, Na;
c) Optimal number of Dollars per order, Ns;
d) Optimal number of Units per order, Nu.
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