Annual demand 12,000 units; EOQ 600 units. Number of orders per year is:
A20
B12
C15
D24
Answer & Solution
Correct answer: A. 20
1. Number of orders per year = annual demand / EOQ.
2. Annual demand = 12,000 units; EOQ = 600 units.
3. Orders per year = 12,000 / 600 = 20.
4. The other choices arise from arithmetic errors or wrong divisors.
_Source: ICAI BoS Inter Paper 3, Ch 2 "Material Cost", §2.5.1 ¶2_
Related questions
Annual usage 5,000 units; ordering cost ₹40; carrying cost 20 percent of price ₹20. OptimaMaximum stock level formula is:EOQ when discount is offered changes when:Abnormal loss in material processing is:Stores ledger records material movements in:VED analysis classifies stores items based on:Carrying cost ₹6/unit, ordering cost ₹120/order, annual demand 18,000 units. EOQ equals:Weighted average price after receipts of 100 units at ₹10 and 200 units at ₹13 is: