of estimates that 19,000 spark plugs will be requiresd each month. A supplier quotes a...
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of estimates that 19,000 spark plugs will be requiresd each month. A supplier quotes a price of $8.00 per spark plug. The supplier also offers a special discount option: If all 228,000 spark plugs are purchased at the start of the year, a discount of 2% off the $800 pnce will be given. Lawr wolf can invest its cash at 10% per year. It costs Lawmwolf S280 to place each purchase order. What is the opportunity cost of interest forgone from pu in 12 monthly purchases of 19,000 units per order? 1. all 228,000 units at the start of the 2. Would this opportunity cost be recorded in the accounting system? Why? 3. Should Lawnwolf purchase 228,000 units at the start of the year or 19,000 units each month? Show your 4. What other factors should Lawnwolf consider when making its decision? Print Done
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