A company buys 8000 units of an item for its annual requirement. Each unit costs Rs. 10, the ordering cost per order is Rs. 30 and the carrying cost is 7.5% of the average inventory per year. The economic order quantity will be
A. 566 units
B. 800 units
C. 2530 units
D. 900 units
Answer: Option B
Related Questions on Costing
Basic objective of cost accounting is ________
A. tax compliance.
B. financial audit.
C. cost ascertainment.
D. profit analysis.
Process costing is suitable for ________.
A. hospitals
B. oil refing firms
C. transport firms
D. brick laying firms
The cost which is to be incurred even when a business unit is closed is a _____.
A. imputed cost
B. historical cost
C. sunk cost
D. shutdown cost
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