The Economic Order Quantity: Based on the Statement of Financial Position, 23% percent of the companys total current assets are the intermediate goods used for production every year (assuming that the value of total assets is the units of demand of the year). The stockholding costs of the goods is RM1.50 per unit in a year. The past experience shows that delivery always occurs within one week of placing an order. Each order of the goods is charged a fixed cost of RM50. Calculate the economic order quantity (EOQ) for the component? Then, determine the minimum stock level that requires to place an order for the new stocks to be arrived exactly when the existing stocks are completely used up. (15 marks) Answer scheme: Use the correct EOQ formula (3 marks) Use the correct numbers in EOQ calculation (7 marks) Correctly determine the minimum stock level (5 marks)
STATEMENTS OF FINANCIAL POSITION EQUITY AND LIABILITIES Equity attributable to owners of the Company Share capital Reserves Retained earnings \begin{tabular}{rrrrrr} 17 & 124,997 & 124,997 & 124,997 & 124,997 & 124,997 \\ 18 & 1,559 & 1,559 & 1,559 & & \\ & 55,204 & 38,772 & 19,669 & 36,696 & 34,064 \\ \hline 181,760 & 165,328 & 146,225 & 161,693 & 159,061 \\ & (23) & (21) & (19) & & \\ \hline 181,737 & 165,307 & 146,206 & 161,693 & 159,061 \\ \hline \end{tabular} Non-current liabilities Lease liabilities Deferred tax liabilities Deferred income Total non-current liabilities Current liabilities Loan and borrowing Lease liabilities Trade and other payables Contract liabilities Current tax liabilities Total current liabilities TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES \begin{tabular}{rrrrrr} 19 & 138 & 264 & 414 & & \\ 13 & 167 & 150 & 127 & & \\ 20 & 7,064 & 19,663 & 39,719 & & \\ \cline { 2 - 6 } & 7,369 & 20,077 & 40,260 & & \\ \hline & & & & & \\ 19 & 146 & 183 & 249 & & \\ 21 & 4,027 & 2,552 & 4,690 & 22,196 & 13,827 \\ 22 & 85 & 103 & 237 & & \\ \hline & & & 50 & & \\ \cline { 2 - 6 } & 4,258 & 2,838 & 5,538 & 22,196 & 13,827 \\ \hline & 11,627 & 22,915 & 45,798 & 22,196 & 13,827 \\ \hline & 193,364 & 188,222 & 192,004 & 197,889 & 172,888 \\ \hline \hline \end{tabular} For the financial year ended 30 June 2021 STATEMENTS OF CASH FLOWS STATEMENTS OF FINANCIAL POSITION EQUITY AND LIABILITIES Equity attributable to owners of the Company Share capital Reserves Retained earnings \begin{tabular}{rrrrrr} 17 & 124,997 & 124,997 & 124,997 & 124,997 & 124,997 \\ 18 & 1,559 & 1,559 & 1,559 & & \\ & 55,204 & 38,772 & 19,669 & 36,696 & 34,064 \\ \hline 181,760 & 165,328 & 146,225 & 161,693 & 159,061 \\ & (23) & (21) & (19) & & \\ \hline 181,737 & 165,307 & 146,206 & 161,693 & 159,061 \\ \hline \end{tabular} Non-current liabilities Lease liabilities Deferred tax liabilities Deferred income Total non-current liabilities Current liabilities Loan and borrowing Lease liabilities Trade and other payables Contract liabilities Current tax liabilities Total current liabilities TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES \begin{tabular}{rrrrrr} 19 & 138 & 264 & 414 & & \\ 13 & 167 & 150 & 127 & & \\ 20 & 7,064 & 19,663 & 39,719 & & \\ \cline { 2 - 6 } & 7,369 & 20,077 & 40,260 & & \\ \hline & & & & & \\ 19 & 146 & 183 & 249 & & \\ 21 & 4,027 & 2,552 & 4,690 & 22,196 & 13,827 \\ 22 & 85 & 103 & 237 & & \\ \hline & & & 50 & & \\ \cline { 2 - 6 } & 4,258 & 2,838 & 5,538 & 22,196 & 13,827 \\ \hline & 11,627 & 22,915 & 45,798 & 22,196 & 13,827 \\ \hline & 193,364 & 188,222 & 192,004 & 197,889 & 172,888 \\ \hline \hline \end{tabular} For the financial year ended 30 June 2021 STATEMENTS OF CASH FLOWS
