The Warren W. Fisher Computer Corporation purchases 8,000 transistors each year as components in minicomputers. The unit cost of each transistor is $10, and the cost of carrying one transistor in inventory for a year is $3. Ordering cost is $30 per order. Assume that Fisher operates on a 200-day working year. a. What is the optimal order quantity? b. What is the expected number of orders placed each year? c. What is the expected time between orders? d. What is the total cost?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
20
-3
5. The Warren W. Fisher Computer Corporation purchases 8,000 transistors each year as
components in minicomputers. The unit cost of each transistor is $10, and the cost of
carrying one transistor in inventory for a year is $3. Ordering cost is $30 per order.
Assume that Fisher operates on a 200-day working year.
a. What is the optimal order quantity?
b.
What is the expected number of orders placed each year?
c.
What is the expected time between orders?
d. What is the total cost?
MacBook Air
000
000
F4
F5
F6
$
%
456
&
7
F7
8
DII
F8
9
F9
)
0
Transcribed Image Text:20 -3 5. The Warren W. Fisher Computer Corporation purchases 8,000 transistors each year as components in minicomputers. The unit cost of each transistor is $10, and the cost of carrying one transistor in inventory for a year is $3. Ordering cost is $30 per order. Assume that Fisher operates on a 200-day working year. a. What is the optimal order quantity? b. What is the expected number of orders placed each year? c. What is the expected time between orders? d. What is the total cost? MacBook Air 000 000 F4 F5 F6 $ % 456 & 7 F7 8 DII F8 9 F9 ) 0
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

Blurred answer
Knowledge Booster
Inventory Management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education