Massy Distribution Center (MDC) had 500 boxes of IGA Cornflakes at 30 September 2022 in inventory. The product had been purchased at list price of $18 per box and normally sells for $24 per box. Additional information relating to the units in inventory: VAT —10%; warehousing cost — $0.55 per unit; purchase discount — $0.40 per unit; carriage inwards — $0.60 per unit. Recently, due to poor handling and storage, several boxes appeared less than presentable however the contents were not compromised, and MDC can still sell this item at $24 per unit, provided that some rectification/re-packaging work is undertaken at a cost of $3 per unit. Answer the following: At what amount would this IGA Cornflakes be required to be stated on 30 September 2022? Provide detailed analysis to support your answer.
Massy Distribution Center (MDC) had 500 boxes of IGA Cornflakes at 30 September 2022 in inventory. The product had been purchased at list price of $18 per box and normally sells for $24 per box. Additional information relating to the units in inventory: VAT —10%; warehousing cost — $0.55 per unit; purchase discount — $0.40 per unit; carriage inwards — $0.60 per unit. Recently, due to poor handling and storage, several boxes appeared less than presentable however the contents were not compromised, and MDC can still sell this item at $24 per unit, provided that some rectification/re-packaging work is undertaken at a cost of $3 per unit. Answer the following: At what amount would this IGA Cornflakes be required to be stated on 30 September 2022? Provide detailed analysis to support your answer.
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...
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Massy Distribution Center (MDC) had 500 boxes of IGA Cornflakes at 30 September 2022 in inventory. The product had been purchased at list price of $18 per box and normally sells for $24 per box.
Additional information relating to the units in inventory: VAT —10%; warehousing cost — $0.55 per unit; purchase discount — $0.40 per unit; carriage inwards — $0.60 per unit.
Recently, due to poor handling and storage, several boxes appeared less than presentable however the contents were not compromised, and MDC can still sell this item at $24 per unit, provided that some rectification/re-packaging work is undertaken at a cost of $3 per unit.
Answer the following:
- At what amount would this IGA Cornflakes be required to be stated on 30 September 2022? Provide detailed analysis to support your answer.
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