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badd99 badd99
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8 months ago

Fashion Clothiers
Assume that Fashion Clothiers Inc. uses 1,440,000 metres of material each year. Further, assume that Fashion can order the material at a cost of $2 per metre, plus fixed ordering costs of $100 per order. The firm's carrying cost is 20% of the inventory value, at cost.


Refer to Scenario: Fashion Clothiers. Now, suppose the manufacturer offers a discount of 0.5% for orders of a least 40,000 metres. Should Fashion Clothiers increase its ordering quantity to take the discount?


▸

Yes; it will save $827 if it takes the discount.



▸

No; it will lose $827 if it takes the discount.



▸

Yes; it will save $13,573 if it takes the discount.



▸

No; it will lose $13,573 if it takes the discount.

Textbook 
Financial Management: Theory and Practice

Financial Management: Theory and Practice


Edition: 4th
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munjojmunjoj
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8 months ago
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badd99 Author
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8 months ago
this is exactly what I needed
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You make an excellent tutor!
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Just got PERFECT on my quiz
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