The formula for ordering cost is the
A)number of orders per year ´ cost of placing an order.
B)number of orders per year/cost of placing an order.
C)average number of units in inventory ´ cost of carrying one unit in inventory.
D)average number of units in inventory/cost of carrying one unit in inventory.
E)ordering cost + carrying cost.

Question

Quizplus · Accepted Answer

The formula for ordering cost is the number of orders per year multiplied by the cost of placing an order. This formula calculates the cost incurred every time an order is placed, taking into account the number of orders placed in a year and the cost associated with placing each order.

The Formula for Ordering Cost Is the