Scenario 9.9 "Gollee Those Cats Sure Go Through a Lot of Food

question 74

Multiple Choice

Scenario 9.9
"Gollee those cats sure go through a lot of food," Geoff exclaimed as he saw the shopping list pad that had been pre-printed with the words "cat food" at the top. He pondered a different approach to shopping for the furry little darlings, reviewed his shopping records, and discovered the following. The price of cat food has held steady at 89 cents per can. Despite feigning indifference, each of the seven cats nibbles their way through an average of one can per day, three hundred sixty five days a year. The price of gasoline has held constant at $3.50 per gallon and his pickup uses a gallon each way to the cat food store. The cost to hold a can of cat food is 10% of the unit price.
-Use the information in Scenario 9.9 to determine the amount of time in-between trips to the cat food store if Geoff wisely elects to follow an EOQ policy for obtaining cat food.

• A) about three months
• B) about three weeks
• C) about six months
• D) about three days

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Definitions:

HST

Harmonized Sales Tax, a combined tax that includes both federal and provincial sales taxes, applied in some regions of Canada.

Pay-No-HST

A situation or offer where the Harmonized Sales Tax (HST) is not applied, making the purchase effectively tax-free.

Cumulative Investment

The total amount of money that has been invested over a period, including reinvested earnings.

Extra Funds

Additional money available beyond what is necessary for regular expenses, which can be saved or invested.