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ACCA F2 Inventory Control (part c) – Economic Batch Quantity
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Hello, with regards to example four where it asks for the costs involved, why do you not add on the purchase cost (50,000×30)? Does it just mean the inventory costs?
Many thanks,
Rachel
It will be made clear in exam questions whether or not it is just the inventory costs that are required.
Hello sir kindly help me with this question.
In the economic batch quantity, how can customers buy during the days of production?I mean how can we supply before the products arrive?
We assume that our factory does not wait until they have produced the whole batch before they deliver them to our shop. They deliver them to us as they produce them, so as they are coming in we can be selling them.
Hi John,
Your lecture has been very helpful. Thank you very much
You are welcome, and than you for the comment 馃檪
Hi
Is EBQ apart of f9 syllabus? I have not seen it my exam kit and theory book. I know EOQ is definitely apart of the syllabus but not sure about EBQ.
No – EBQ is not examined at Paper F9 – only EOQ. (In theory it could be asked, because it is assumed knowledge from F2, but it is not asked)
Thank you very much John for dedicating your time to this. Excellent lectures which make the whole study experience for me much more enjoyable and I am confident, passing a lot easier. I appreciate all the little tips and tricks along the way as well as areas to look out for in the exam immensely
Thank you very much for your comments 馃檪
Helo Sir, kindly help me in this question
Aliicez Pic purchases an item of material from an outside supplier who supplies it at the ratio of 80 unites per day. The annual use os 8,000 units. The demand for production is 80 unit per day. The purchase price per unit is $ 10, The annual holding coat per init per Annam is 20% of the purchase price and the set-up cost per order is $ 250.
i am confuse in the Ch (Holding Cost)
In future please ask this sort of question in the Ask the Tutor Forum rather than as a comment on a lecture.
The question says that the annual holding cost is 20% of the purchase price.
Ch is the annual cost of holding one unit, and is therefore 20% x $10 = $2.
units and demand per day but the holding cost per annam so, how i can solve it
You use the formula.
I have told you Ch, the question tells you the annual demand and also tells you Co. That is all you need.
John you are fantastic.
You are very kind – thank you 馃檪
Mr. Moffat,
For example #4 i am having trouble finding just how you derived at 2722 units i keep getting 2449
The answer is definitely 2,722, and I do show the workings in the lecture. I can only think that maybe you are using your calculator wrongly.
hi john
I really thank you from the bottom of my heart for this great service. You are amazing.
I just wonder what we are doing wrong as i too continue to get 2449 when typing the entire thing into the calculator correctly (as it is written out). When, however, I segregate the calculation into parts, it comes to 2722. I would like to know why as i don’t want to get it wrong in the exam.
thanks so much
I can’t really help without seeing your calculator (different calculators do things differently).
Are you pressing ‘equals’ before you take the square root?
26:32 there’s a mistake. It should be 50 000 over 500 000. Am I correct?
You are correct – I missed off a zero – but the calculation is done correctly (which is what matters 馃檪 )
Thank you very much.wish I could do more than just type “thank you”
You are welcome 馃檪
Dear John,
First of all, thank you for your efforts putting so much on the spread of free education. The way you explain things and your intonation help me to memorize them much easier later on. Yet the content you deliver us may be polished in terms of visualtion. I would appreciate if you choose the combination of different colours (such as green background and white chalk) while writing on the board. In the future, you may also consider preparing formulas, graphs, pie charts and all other visuals beforehand by the help of more sophisticated tools. And I’m sure there would be many of us willing to appreciate your hard work and donate to support the oppotyunity cost of preparing those esthetics.
Thanks!
Thank you for your comment.
However we do not use blackboards and chalk!!!
With regard to more sophisticated tools, please appreciate that we provide all of this free of charge – we prefer to use our limited resources in increasing and improving on what we offer on this website. We consider the content to be the most important.
Thank you for offering to donate, but we do not accept donations and we will never charge for anything we offer.