Question
QUESTION ONE Halwings Group Limited wishes to achieve excellent stock management so as to achieve a marvelous profit this year. Its management estimates the
QUESTION ONE Halwings Group Limited wishes to achieve excellent stock management so as to achieve a marvelous profit this year. Its management estimates the demand for its products to be 1000 units per annum, with a purchase price of shs.10 per unit, a holding cost of shs.0.75 per unit and ordering cot of shs.15 per order. The supplier of the stocks has presented Halwings Group Limited with the following range of prices of the stocks: Quantity Price Per Order size (in units) Discount Unit (Shs) (%) 0-99 0 10 100-199 1 9.90 200-399 2 9.80 400-599 4 9.60 600-799 5 9.50 800-899 5 9.50 900-999 5.5 9.45 Due to its storage capacity, the company can only purchase a amount of up to 600 units. Currently, the company purchasing at optimum stock quantity to enable it achieve i objectives. The management is considering whether to shi from the current stock purchase policy to purchase th maximum stocks. Required; a) Calculate the current EOQ in units. (5 Marks)
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