# Annual usage is 6000 units @ Rs 20 per unit Cost of placing an order is Rs 60 and annual carrying cost of one unit is 10% of inventory value EOQ = __________.

A. 600 units

B. 750 units

C. 1200 units

D. 1250 units

**Answer: Option A **

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Related Questions on Costing

**Costing, which explains how and when scrap affects operating income of company is classified as**

A. inventory costing

B. conversion costing

C. normal scrap costing

D. abnormal scrap costing

A. 14.00%

B. 15.00%

C. 10.00%

D. 12.00%

**Weak relationship between cost and cost driver is indicated on a regression line, which is**

A. curved

B. slightly sloped

C. completely sloped

D. dotted

**Terms used in manufacturing cost systems are**

A. manufacturing costs

B. prime costs

C. conversion costs

D. both B and C

According to cost accounting there is a proper formula to calculate:

EOQ =Under root of ( 2*Annual consumption*Ordering cost)/(Unit cost*Carrying cost)

so put values in formula like: under root of (2*6000*60)/(10*20) =720000/200 = 3600

so after removing square root from 3600 the answer is 600.

EOQ = Root OF (2×6000×60/)20×10% = 600 Units