Albuquerque Company Has the Following Information Available Concerning One of Its

question 74

Multiple Choice

Albuquerque Company has the following information available concerning one of its inventory items: $$\begin{array} { l r } \text { Cost of placing an or der } & \$ 50.00 \\\text { Unit carrying cost per year } & \$ 2.00 \\\text { Annual unit demand } & 3,200 \\\text { Safety stock } & 80 \\\text { Average daily demand } & 10 \\\text { Normal lead time in days } & 12\end{array}$$ The economic order quantity for this item is

• A)16 units.
• B)160,000 units.
• C)500 units.
• D)400 units.

---

Definitions:

Transactions

Financial events that affect the assets, liabilities, or equity of a company, recorded in its accounting system.

Accounting

The systematic process of recording, measuring, and communicating information about financial transactions.

Risk

The exposure to uncertainty or potential financial loss in decision-making and investment.

Return

The profit or loss derived from an investment or business operation after all expenses are accounted for.