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u. MUlluay, 22, 18 notebooks remain in inventory at the store. How many notebooks should the store manager order? ase Problem WAGNER FABRICATING COMPANY Managers
u. MUlluay, 22, 18 notebooks remain in inventory at the store. How many notebooks should the store manager order? ase Problem WAGNER FABRICATING COMPANY Managers at Wagner Fabricating Company are reviewing the economic feasibility of man ufacturing a part that the company currently purchases from a supplier. Forecasted annual demand for the part is 3200 units. Wagner operates 250 days per year Wagner's financial analysts established a cost of capital of 14% for the use of funds for investments within the company. In addition, over the past year $600,000 was the aver age investment in the company's inventory. Accounting information shows that a total of $24,000 was spent on taxes and insurance related to the company's inventory. In addition, an estimated $9000 was lost due to inventory shrinkage, which included damaged goods as well as pilferage. A remaining $15,000 was spent on warehouse overhead, including utility expenses for heating and lighting
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