# Suppose that the demand for a particular t-shirt the UNC Student Stores sells is deterministic with 2 units per day. Each t-shirt costs \$10 and the monthly charge of carrrying one t-shirt is 50 cents. If the fixed cost of placing an order (e.g. transportation cost etc.) regardless of the order size is \$200 and the order arrives instantaneously, what is the optimal number of t-shirts the UNC Student Stores should order every time it places an order and how frequently should the orders be placed?

EOQ = 220.6052281 shirts rounded off to 221 shirts

The order should be placed after every 110 days.

Explanation:

The EOQ or economic order quantity is the optimum order level or quantity which minimizes the inventory related costs. This is the order quantity where the cost of ordering and the cost of holding the inventory is the minimum. The formula for EOQ is,

EOQ = √(2 * AD * O) / H

Where,

• AD refers to annual demand
• O is ordering cost per order
• H is holding cost per unit per year

Annual demand for t shirts (assuming 365 days per year) = 2 * 365 = 730

Holding cost per unit per year = 0.5 * 12 = \$6

EOQ = √(2 * 730 * 200) / 6

EOQ = 220.6052281 shirts rounded off to 221 shirts

To calculate how frequently the order should be placed,we will calculate the number of orders per year by dividing the total annual demand by the EOQ.

Number of orders per year = 730 / 220.61

Number of orders per year = 3.309 or 3.31 orders per year

Number of days per order = 365 / 3.309

Number of days per order = 110.305 days or 110 days

## Related Questions

Pharell works in the Government and Public Administration career cluster. Physical fitness and patriotism are very important tohim and he would like to travel to new places around the world. Which career pathway would best suit Pharell?
O Planning
O Governance
O Revenue and Taxation
O National Security

O National Security

Explanation:

The Government and Public Administration cluster is composed of people who assist in enforcing the law. The cluster includes people in military workers,  municipal clerks, and service clerks,

National security concerns the ability of a country to cater to its citizenry's protection and defense. Pharell liking for physical fitness and patriotism will make him a perfect fit for protecting the citizens and the country.

Sorry im late but theyre right

Explanation:

If he wanted the cash award of each of the five prizes to be \$45,000 and his estate could earn 7% per year, how much would he need to fund his prizes

Explanation:

Price of each award is \$45,000

And there are 5

Therefore, we have 5 x \$45,000

=\$225,000.

So, \$225,000 is the future value.

Rate of return(r) in 7% and it is being assumed that it is forever.

So, so how much will be needed to fund his prizes(present value)?:

PV = FV/r

= \$225,000/0.07

=\$3,214,285.71

Consider the information about the economy of Pakistan. Note that the currency of Pakistan is the rupee. The government purchases: 2.80 trillions of rupees. Individuals consume: 10.50 trillions of rupees. Individuals save: 5.10 trillions of rupees. Businesses invest: 1.30 trillions of rupees. Foreigners spend: 0.64 trillions of rupees to purchase Pakistani firms. Pakistan imports: 2.09 trillions of rupees. Pakistan exports: 1.30 trillions of rupees.

Pakistan's GDP is 13.81 trillions of rupees.

Explanation:

GDP = C + I + G + NX

Here:

C = 10.50

I = 1.30

G= 2.80

NX =  (1.30 - 2.09) = -0.79

GDP = 10.50 + 1.30 + 2.80 - 0.79

GDP = 13.81

3. Individual Problems 8-3 Suppose that due to the outbreak of a new flu, known as H14N9, the demand for hand sanitizer has tripled. Smith & Smith, a company that produces and sells hand sanitizer, should production of its hand sanitizer. Suppose there is no vaccine for H14N9, and that a vaccine will not be developed for several decades. True or False: Smith & Smith should increase its productive capacity by leasing new plant and equipment.

True

Explanation:

As for the provided information, the flu is new in market and has serious issues involved, and now since no remedy or cure is possible and will not be possible even in near future,

The hand sanitizer will help as a preventive action from getting infected to the Flu. Thus, people will buy the sanitizer at huge level.

Thereby, the demand for such product will increase in market in huge, and accordingly even if the company has to increase production capacity through lease it shall do so.

As with huge turnover break even will be realized and there will be profits.

Washington inc. issued \$705,000 of 6%, 20-year bonds at 98 on January 1, 2009. Through January 1, 2017, Washington amortized \$8,200 of the bond discount. On January 1, 2017. Washington Inc. retired the bonds at 102 (after making the interest payment on that date). What is the gain or loss that Washington Inc. would report for the retirement of this bond?

\$20,000

Explanation:

Bond discount at the issuance of bond:

= Worth of Bonds issued -  [(Worth of Bonds issued ÷ 100) × Issue price]

= 705,000 - [(\$705,000 ÷ 100) × 98]

= \$705,000 - \$690,900

= \$14,100

Bond Payable = \$705,000

Unamortized bond discount:

= Bond discount at the issuance of bond - Amortized amount

= \$14,100 - \$8,200

= \$5,900

Redemption Value of Bond = Retired price of bonds × 7,050

= 102 × 7,050

= \$719,100

Loss on retirement on Bond:

= Redemption Value of Bond - (Worth of Bonds issued -  Unamortized bond discount)

= 719,100 - (705,000 - 5,900)

= 719,100 - 699,100

= \$20,000

When Washington Inc. retired the bonds, they would report a gain of \$19,300.

### Explanation:

When Washington Inc. retired the bonds on January 1, 2017, the gain or loss that they would report can be calculated as follows:

1. Calculate the carrying value of the bonds on the retirement date: \$705,000 - \$8,200 = \$696,800.
2. Compare the carrying value to the cash received from the retirement:

If the cash received is higher than the carrying value, there is a gain. If the cash received is lower than the carrying value, there is a loss.

In this case, Washington Inc. retired the bonds at 102, which means they received \$716,100. Since \$716,100 is higher than the carrying value (\$696,800), Washington Inc. would report a gain of \$716,100 - \$696,800 = \$19,300 for the retirement of the bond.

brainly.com/question/17405470

#SPJ3

I am having a diffiucult time figuring out the advertising expense. I have plugged in several solutions and they are all incorrect.Listed below are several transactions that took place during the second and third years of operations for RPG Company.
Year 2 Year 3
Amounts billed to customers for services rendered \$ 320,000 \$ 420,000
Cash collected from credit customers 230,000 370,000
Cash disbursements:
Payment of rent 77,000 0
Salaries paid to employees for services rendered during the year 137,000 157,000
Travel and entertainment 27,000 37,000
In addition, you learn that the company incurred advertising costs of \$24,000 in year 2, owed the advertising agency \$4,900 at the end of year 1, and there were no liabilities at the end of year 3. Also, there were no anticipated bad debts on receivables, and the rent payment was for a two-year period, year 2 and year 3.
Required:
1. Calculate accrual net income for both years.
2. Determine the amount due the advertising agency that would be shown as a liability on RPG’s balance sheet at the end of year 2.

RPG Company

1. Accrual Net Income for Year 2 and Year 3:

Year 2             Year 3

Amounts billed to customers for services  \$ 320,000   \$ 420,000

Expenses:

Rent                                                                     38,500         0

Salaries paid to employees for services          137,000       157,000

Travel and entertainment                                  27,000        37,000

Net Income                                                      \$93,500     \$170,900

2. Determination of the liability for Advertising:

Year 1 balance = \$4,900

Year 2 =            \$24,000

Cash paid           (13,500)

Balance             \$15,400

Explanation:

a) Data and Calculations:

RPG Company.

Year 2             Year 3

Amounts billed to customers for services  \$ 320,000   \$ 420,000

Cash collected from credit customers           230,000       370,000

Cash disbursements:

Payment of rent                                                  77,000         0

Salaries paid to employees for services          137,000       157,000

Travel and entertainment                                  27,000        37,000

Year 2             Year 3

Service Revenue:   \$ 320,000   \$ 420,000

Accounts Receivable

Service revenue  \$320,000

Cash collected       230,000

Balance Year 2      \$90,000

Service revenue    420,000

Cash collected      370,000

Balance Year 3     \$50,000

Year 1 balance = \$4,900

Year 2 =            \$24,000

Cash paid           (13,500)

Balance             \$15,400

Year 3 =              16,600

Cash paid           32,000

Balance               0

The accrual net income for RPG Company in Year 2 is \$55,000, and in Year 3 is \$194,000. The amount due to the advertising agency shown as a liability on RPG's balance sheet at the end of Year 2 is \$0, as it was completely paid off in that year.

### Explanation:

In order to calculate the accrual net income and determine the liability of the advertising agency, we first need to correctly account for all the incomes and expenses. Here's how it works:

Accrual net income is calculated as revenues (Amounts billed to customers) minus expenses. For year 2, the expenses include Payments of rent, Salaries paid, Travel and entertainment, and Advertising costs. For year 3, as there was no rent payment and no liabilities at the end of the year, we deduct only the Salaries paid, Travel and entertainment, and Advertising costs from the revenues.

Revenues

Year 2: \$320,000
Year 3: \$420,000

Expenses

Year 2: Rent(\$77,000) + Salary(\$137,000) + Travel & Entertainment(\$27,000) + Advertising(\$24,000) = \$265,000
Year 3: Salary(\$157,000) + Travel & Entertainment(\$37,000) + Advertising(\$32,000) = \$226,000

Accrual Net Income

Year 2: \$320,000 - \$265,000 = \$55,000
Year 3: \$420,000 - \$226,000 = \$194,000

The amount owed to the advertising agency that should be considered as a liability at the end of year 2 can be figured out by taking into account the advertising expenses incurred in year 2 and the previous year's outstanding. But since we learn that there were no liabilities at the end of year 3, the outstanding \$4,900 at the end of year 1 must be paid in year 2 along with the incurred cost of \$24,000. Therefore, the liability at the end of year 2 would be \$0.