Explore BrainMass
Share

Inventory Control Methods

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

Jim Overstreet, inventory control manager for Itex, receives wheel bearings from Wheel-Rite, a small producer of metal parts. Unfortunately, Wheel-Rite can only produce 500 wheel bearings per day. Itex receives 10,000 wheel bearings from Wheel-Rite each year. Since Itex operates 200 working days each year, its average daily demand for wheel bearings is 50. The ordering cost for Itex is $40 per order, and the carrying cost is 60 cents per wheel bearing per year. How many wheel bearings should Itex order from Wheel-Rite at one time? Wheel-Rite has agreed to ship the maximum number of wheel bearings that it produces each day to Itex when an order has been received.

© BrainMass Inc. brainmass.com October 16, 2018, 9:56 pm ad1c9bdddf
https://brainmass.com/economics/microeconomics/inventory-control-methods-202603
$2.19
Similar Posting

Temporary accounts, financial leverage, perpetual inventory, imprest fund, gross margin method and more.

3.
Describe the difference between temporary and permanent accounts, and state which ones are closed. Describe the purpose of the closing process.

5.
Explain the significance of the return on equity ratio. Who (what category or type of financial statement users) would normally be most interested in this ratio?

6.
What is financial leverage? What financial ratio can be increased by using financial leverage?

7.
Discuss the major differences between a perpetual inventory system and a periodic inventory system.

8.
Why are cash discounts given, and who benefits by these discounts?

10.
List the specific steps used in computing the estimated inventory balance using the gross margin method.

11.
List the measures that a business can use to achieve strong internal controls.

12.
Petty cash funds are maintained on an imprest basis. Explain the advantage of using the imprest basis in accounting for petty cash.

13.
Rolla Company was founded in 2010. It acquired $30,000 cash by issuing stock to investors and an additional $20,000 cash by borrowing from creditors. During 2010 it received $15,000 cash revenues and paid $22,000 in cash expenses. The company then went out of business.What amount of cash should Rolla Company have had on hand immediately before going out of business?

14.
Why would a merchandising company need good internal controls related to its inventory?

16.
Rolla Company was founded in 2010. It acquired $30,000 cash by issuing stock to investors and an additional $20,000 cash by borrowing from creditors. During 2010 it received $15,000 cash revenues and paid $22,000 in cash expenses. The company then went out of business.What amount of cash will Rolla's creditors receive?

17.
Rolla Company was founded in 2010. It acquired $30,000 cash by issuing stock to investors and an additional $20,000 cash by borrowing from creditors. During 2010 it received $15,000 cash revenues and paid $22,000 in cash expenses. The company then went out of business.What amount of cash will Rolla's stockholders receive?

18.
List the key elements of an internal control system that would apply to inventory, and explain how each of them does relate to inventory.

19.
What is the purpose of closing entries?

20.
What is the purpose of a journal in accounting?

View Full Posting Details