Question
A company uses Rs. 50000 material per year. The cost per order is Rs. 50 and carrying cost is 20 percent of the average inventory.
A company uses Rs. 50000 material per year. The cost per order is Rs. 50 and carrying cost is 20 percent of the average inventory. The company currently has an optimum purchasing policy but has been offered a 0.4 percent discount if they purchase 5 times per year. Should the offer be accepted? If not what counter offer should be made?
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
10th Edition
1119491630, 978-1119491637, 978-0470534793
