Ticktock Clocks Sells 10,000 Alarm Clocks Each Year

question 33

Multiple Choice

Ticktock Clocks sells 10,000 alarm clocks each year. If the total cost of placing an order is $65 and it costs $85 per year to carry the alarm clock in inventory, use the EOQ formula to calculate the optimal order size.

• A) 124 clocks
• B) 161 clocks
• C) 15,294 clocks
• D) 26,154 clocks

---

Definitions:

Ending Inventory

The total value of goods available for sale at the end of an accounting period.

Inventory Increase

This refers to a situation where the quantity or value of inventory items held by a company grows from one accounting period to another.

Operating Activities

Business activities directly related to the production and delivery of goods and services, generating the primary revenue stream.

Ending Inventory

The cost of merchandise on hand for selling when an accounting cycle ends.