Even Though the Economic Order Quantity (EOQ)is Optimal Only When

question 51

Multiple Choice

Even though the economic order quantity (EOQ) is optimal only when five assumptions are satisfied,it serves as a reasonable first approximation even when these assumptions do not quite apply.Which one of the following is NOT an assumption of the EOQ?

• A) Decisions for one item can be made independently of decisions made for other items.
• B) There is no uncertainty in lead time.
• C) The amount of an order received is exactly equal to what was ordered, without any "short shipments" from a supplier or scrap losses in the shop.
• D) Quantity discounts can be taken advantage of for large lot sizes.

Differentiate between symmetrical and asymmetrical distributions.

Apply the concept of distribution shape to appraise the range of abilities or opinions within a given sample.

Understand the purpose and application of grouped frequency distribution tables in summarizing data.

Know the best practices in selecting the number of intervals for grouped frequency distribution tables.

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Definitions:

Statement of Cash Flows

A financial documentation that illustrates the effect of changes in balance sheet accounts and profit on cash and cash equivalents, dividing the analysis into categories of operating, investing, and financing activities.

Noncash Investing

Investing activities that do not involve the immediate outflow of cash, such as acquiring assets through finance leases.

Financing Activities

Financing activities are transactions involving changes in the size and composition of the equity and borrowings of a company.

Statement of Cash Flows Worksheet

A detailed working paper used in the preparation of the statement of cash flows that reconciles beginning and ending cash balances by analyzing changes in all other accounts.