MCQ Revision Test — OpenTuition Forums

Lleebickle11y ago

Hi Sir, Could you provide me with the workings for the following question PQR Co has a demand of 7500 units per month. Each unit costs $5, ordering costs are $100 per order and the inventory holding cost is 10% of the purchase price per year. There is a lead time of 30 days between placing an order and receiving delivery. If they order the EOQ each time at what level of inventory should a new order be placed? Answer = 7,397 units I am able to calculate the EOQ which is 6,000 units but unsure how to get to the answer? Thanks for your time

John MoffatTutor11y ago#1

They need to order when they have enough left to last for the lead time. The demand per day is (7500 x 12) / 365, and the lead time is 30 days. So they need to order when they have 30 x 7500 x 12 /365 = 7,397 in inventory.

UUmmara11y ago#2

Hey Sir Could you please help me with the working of following question: Xplc has a dividend yield of 0.08% and dividend cover of 2.4 what is the P/E ratio? thankyou :)

John MoffatTutor11y ago#3

Dividend yield = Dividend / MV ( = 0.08) So MV = Dividend / 0.08 Dividend cover = EPS / Dividend ( = 2.4) So EPS = Dividend x 2.4 PE ratio = MV / EPS = (dividend / 0.08) / (dividend x 2.4) Divide top and bottom by dividend: PE ratio = (1/0.08) / 2.4 = 12.5 / 2.4 = 5.21

UUmmara11y ago#4

Thankyou so much

John MoffatTutor11y ago#5

You are welcome :-)

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