A company manufactures 5000 units of a product per month. The cost of placing an...
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Accounting
A company manufactures 5000 units of a product per month. The cost of placing an order is Rs. 100. The purchase price of the raw material is Rs. 10 per kg. The re-order period is 4 to 8 weeks. The consumption of raw materials varies from 100 kg to 450 kg per week. The average consumption is 275 kg. The carrying cost of the inventory is 20% per annum. You are required to calculatea. Re-order quantity (Economic order quantity) b. Re-order level c. Maximum level d. Minimum level e. Average Stock Level
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