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1 (10) The See King Hotel's sales forecast for the next quarter, ending December 31st, indicates the following: Product Expected Sales Snapper 2,000 units Shrimp
1 (10) The See King Hotel's sales forecast for the next quarter, ending December 31st, indicates the following: Product Expected Sales Snapper 2,000 units Shrimp 3,500 units Calamari 5,200 units Inventories at the beginning, and desired quantities at the end of the quarter are as follows: Product October 1st December 31st Snapper 580 units 250 units Shrimp 160 units 150 units Calamari 130 units 180 units Draw up a Production budget in units for next quarter. Question 2 (15) The management of Yenza Ltd has received quotations on a new machine for one of its production departments. The cost price of the machine is R320,000 and the company's minimum required rate of return on investments is 14%. The following projected cash income figures have been compiled: End of Year 1 R75,000 End of Year 2 R87,000 End of Year 3 R75,000 End of Year 4 R62,000 Advise the management of Yenza Ltd as to whether you consider the new machine to be profitable or not. Make use of the Net Present Value (NPV) method. (Give answers with no decimals) Question 3 (5) Rocco's manufactures 1,600 units of product per year. The cost of materials for these products are R40 per unit and the cost of placing and receiving one order is R50. Annual carrying cost is 10% of the inventory value. Calculate the Economic Order Quantity for Rocco's
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