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Dusty Company

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Dusty Company

  • This topic has 3 replies, 2 voices, and was last updated 3 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • May 21, 2022 at 11:15 am #656124
    Varun.J.Thakkar
    Participant
    • Topics: 75
    • Replies: 112
    • ☆☆

    Sir in part A of this question they have taken holding cost per unit of 0.21 whereas it should have been 0.63 according to me and you as well(you had cleared a student’s doubt in previous forum)
    My question is by using 0.63 i am getting a different answer than their solution..

    I am getting
    A (i) Holding cost = 62500*0.63= 39375
    ordering =3124
    Total = 42399

    A (ii) EOQ = 34641 units
    Holding cost= ordering cost=10911
    Total = 21822
    Therefore saving = 20577

    Their saving = 17199

    A (iii) Holding cost =0.63*125000= 78750
    Ordering cost =6*252 = 1512
    Total cost = 80262

    Increase in annual holding and ordering cost= 80262- 42399 = 37863
    Discount benefit = 1.5m*14*0.5% = 105000
    Saving = 105000-37863 = 67137

    Their saving=67399

    Are my answers correct?
    Kindly tell sir..Thanks a lot for ur help

    May 22, 2022 at 7:57 am #656160
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54749
    • ☆☆☆☆☆

    Your answer looks to be correct. 🙂

    May 22, 2022 at 11:40 am #656177
    Varun.J.Thakkar
    Participant
    • Topics: 75
    • Replies: 112
    • ☆☆

    Thank you sir!

    May 22, 2022 at 4:32 pm #656195
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54749
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘Dusty Company’ is closed to new replies.

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