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. 5. (a) EXE Limited has received an offer of quantity d scounts on its order of materials as under Price per ton Ton [Nos.)

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5. (a) EXE Limited has received an offer of quantity d scounts on its order of materials as under Price per ton Ton [Nos.) 1,200 1,180 1,160 1,140 1,120 Less than 500 500 and less than 1,000 1,005 and less than 2,000 2,007 and less than 3,000 3,000 and above. The annual requirement for the material is 5,000 tons. The ordering cost per order is R1,200 and the stock holding cost is estimated at 20% of material coit per annum. You are required to COMPUTE the most economical purchase level. (b) WHAT will be your answer to the above question if there are no discounts offered and the price per ton is 1,500

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