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Case 3: Mathematics of Buying and Selling (10 Marks) You are the purchasing officer of a fast-food restaurant that is selling hamburger in the city
Case 3: Mathematics of Buying and Selling (10 Marks) You are the purchasing officer of a fast-food restaurant that is selling hamburger in the city of Muscat. The fast food chain business operates 25 stores strategically located in the region. Due to the decline in demand caused by the epidemic, the company is proposing measures to cut cost. The manager asked you to look for cheaper source of raw materials (bread). The company always avail of trade and cash discount. You decided to call the suppliers and gathered the following data; Nesto Hypermarket The supplier offers 10% trade discount. Al Fayha Hypermarket - The supplier offers chain discounts of 5/3/2. Lulu Supermarket - The supplier offers no trade discount but cash discount of 5/10, n/30. Carrefour Supermarket - The supplier offers trade discount of 5%, the terms of payment are 2/10, n/30. You are required to answer the following questions; A. If the company decides to buy OMR 2,000 worth of br amount of trade discount? What is the net price? from Nesto Hypermarket, what is the (2 Marks) B. If the company decides to buy OMR 2,000 worth of bread from Al Fayha Hypermarket, what is the single discount equivalent? What is the net price? (2 Marks) C. If the company decides to buy OMR 2,000 worth of bread from Lulu Supermarket, what is the amount of discount and the price paid if made within the discount period? (2 Marks) D. If the company decides to buy OMR 1,500 worth of bread from Carrefour Supermarket, what is the amount of trade discount, cash discount and the price paid if made within the discount period? (2 Marks) E. Which supplier would you recommend? Discuss your reasons. (1 Mark) F. Discuss behavioral and non-financial factors you consider when choosing a supplier. Explain your answer. (1 Mark)
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