Bishop Manufacturing Is Implementing the Economic Order Quantity (EOQ) Inventory

question 37

Multiple Choice

Bishop Manufacturing is implementing the economic order quantity (EOQ) inventory control system, and they need a good estimate of the cost to process a purchase order (PO) . It takes 5 total labor hours to process a PO. The average number of stock-keeping units (SKUs) on a PO is 2.2. The average wage for people working in the purchasing department is $22 per hour, plus employee benefits of $3 per hour. Fixed costs for the purchasing department are $250,000 per year assuming a 2,000 hour per employee per year workweek. Given this information a good estimate of the cost to order one SKU is _____.

• A) $5.00
• B) $56.82
• C) $113.36
• D) $125.00

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Definitions:

Free Choice

The freedom of individuals to make decisions or actions without coercion or constraint from external entities, often seen in contexts like voting, employment, and consumer behavior.

Unfair Labor Practice

Actions by employers or unions that violate workers' rights or the rules governing labor relations.

No Solicitation Policies

Workplace rules that restrict employees from soliciting for any cause, including union membership, during their working hours and in certain areas.

Discriminatory Enforcement

The unfair application of laws, policies, or rules against particular groups of people or individuals, leading to bias and inequity.