Accounting for Material.

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February 28, 2022 at 11:13 pm #649529
sarbrina
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Hi Mr. Maffot

Can you please explain what to do with the resupply of 10000 units.

ACB Co gradually receives its re-supply of inventory at a rate of 10,000 units a week. Other information is available as follows.

Weekly demand 5,000 units
Set-up costs for each production run $125
Weekly cost of holding one unit $0.0025

What is the economic production run?
March 1, 2022 at 8:02 am #649542
John Moffat
Keymaster
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You need to use the economic batch quantity formula, as explained in my free lectures on inventory control.
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