Rolf Steps Is the Production Manager for a Local Manufacturing

question 121

Multiple Choice

Rolf Steps is the production manager for a local manufacturing firm.This company produces staplers and other items.The holding cost is $2 per unit per year.The cost of setting up the production line for this is $25.There are 200 working days per year.The production rate for this product is 80 per day.If the production order quantity is 200 units,what was the daily demand (rounded to the nearest whole unit) ?

• A)6 units
• B)7 units
• C)8 units
• D)9 units
• E)None of the above

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Definitions:

Book Value

Represents the value of a company as recorded on its books, calculated by subtracting total liabilities from total assets.

Market Value

The current value of an asset or company based on the price that it can be sold for on the open market.

Historical Cost

The initial cost of an asset or investment when it was first purchased.