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Please help me to solve this question.I will upvote u.Thanks. Question 3 (a) The finance director of Stabila Bhd is concerned about the company's profitability
Please help me to solve this question.I will upvote u.Thanks.
Question 3 (a) The finance director of Stabila Bhd is concerned about the company's profitability due to the increased costs of inventory. The company recently finds that the inventory level for item AT103, one of its components for manufacturing is low in stock and requires replenishment immediately. Nonetheless, the company is uncertain of the order quantity to place from its supplier and is considering the following options: Option A Order Quantity Total Holding Cost Total Ordering Cost Total Inventory Cost 4.870 units RM23,376 RM11.458 : RM34,834 Option B Order Quantity Total Holding Cost Total Ordering Cost Total Inventory Cost : 3,410 units : RM16,368 :RM16,368 :RM32,736 Option Order Quantity Total Holding Cost Total Ordering Cost Total Inventory Cost : 2,630 units RM12,624 RM21,217 RM33,841 Recommend ONE (1) option from the above to the company with justifications based on the concept of Fconomic Order Quantity inventory management technique (13 marks) (b) Yumyum Sdn. Bhd. has recently observed a deterioration in its liquidity position. This is likely caused by a lengthened receivables collection period of the company as its credit customers are taking longer than the credit period granted to settle payment. Moreover, the company is also concerned about the significant inerement in the payment defaults by credit customers as the level of bad debts has been doubled since the number of credit customers with low or poor credit ratings has surged over the years. With examples, explain any FOUR (4) of the SC's system that the company can use for credit granting decision to mitigate the above issue. (12 marks) [Total: 25 marks)
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