alleryStart learning →Which input does the optimal EOQ NOT depend on?
ACost of each order
BUnit purchase price
CYearly demand level
DHolding cost per unit
Answer & Solution
Correct answer: B. Unit purchase price
Q* is a function of only order cost, demand and holding cost per unit, so the purchase price does not affect it.
Keep practising Inventory Valuation
Browse all Inventory Valuation questions for CA Inter, or explore more Cost and Management Accounting topics.
Related questions
The ABC concept is based on whose law?An item needs 500 units a year at Rs 40 each. What is its annual usage value?After computing usage values, items are arranged in which order?In ABC analysis, how is an item's annual usage value computed?ABC class thresholds are what?Class B holds 30% of items. About what share of annual consumption value does it hold?Half of all items fall in class C. Roughly what share of consumption value do they hold?ABC analysis resembles which principle, where few items carry most value?