Need help
A company uses components at the rate of 500 units per month, which are bought in
at a cost of $1.20 each from the supplier. It costs $20 each time to place an order,
regardless of the quantity ordered. The total holding cost is 20 % per annum of the
value of inventory held.
What is the total annual cost?
A $120
B $240
C $7,320
D $7,440
A company uses components at the rate of 500 units per month, which are bought in
at a cost of $1.20 each from the supplier. It costs $20 each time to place an order,
regardless of the quantity ordered. The total holding cost is 20 % per annum of the
value of inventory held.
What is the total annual cost?
A $120
B $240
C $7,320
D $7,440