Economic order quantity is that quantity at which cost of holding and carrying inventory is:
A. Maximum and equal
B. Minimum and equal
C. It can be maximum or minimum depending upon case to case
D. Minimum and unequal
Answer: Option B
Solution (By Examveda Team)
Economic order quantity is that quantity at which cost of holding and carrying inventory is minimum and equal. Economic order quantity (EOQ) is the ideal order quantity a company should purchase for its inventory given a set cost of production, a certain demand rate, and other variables. This is done to minimize inventory holding costs and order-related costs.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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