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ECONOMIC ORDER QUANTITY

Forums › ACCA Forums › ACCA FA Financial Accounting Forums › ECONOMIC ORDER QUANTITY

  • This topic has 2 replies, 3 voices, and was last updated 9 years ago by John Moffat.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • August 5, 2015 at 7:15 am #265575
    kabuu
    Member
    • Topics: 1
    • Replies: 1
    • ☆

    A wholesaler has an annual demand for dolls of 1,400 units. The cost of typical doll to the wholesaler is kshs 400 if she orders between 100-200units. The carrying cost is estimated to be 20%of the unit price and the ordering cost is kshs 25 per order. If the distributor orders 201-299, she get a2% discount, 300-399 a 5% discount and 400 or more she a 5.5% discount.
    1. Determine the EOQ and advice on the best discount.
    2. Find the optimal number of orders. How do I go about this.

    August 5, 2015 at 8:26 am #265585
    Sam
    Member
    • Topics: 0
    • Replies: 1
    • ☆

    I am really struggling with EOQ.. so I will try,..

    1- work out the EOQ =
    sq rt = 2*1400/400/80=8.94 ?

    August 5, 2015 at 8:45 am #265593
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54664
    • ☆☆☆☆☆

    I suggest that you would be better to ask this in the F2 Ask the Tutor Forum.
    EOQ’s are not examinable in Paper F3.

    Also, calculating the EOQ and dealing with discounts is explained in full in our free lectures on Inventory Control!

  • Author
    Posts
Viewing 3 posts - 1 through 3 (of 3 total)
  • The topic ‘ECONOMIC ORDER QUANTITY’ is closed to new replies.

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