83) Cool Enterprises has one particular product that has an annual demand of 1000 units. Total
manufacturing costs per unit total $40 and setup costs per batch are $15. Direct material
ordering costs for the product total $10 per order. Currently, the carrying costs per unit are
25% of manufacturing costs.
Determine the economic manufacturing order quantity.
84) Bendigo Visual Corporation manufactures screens for laptop computers. All processing is
initiated when an order is received. For March there were no beginning inventories.
Conversion Costs and Direct Materials are the only manufacturing cost accounts. Direct
Materials are purchased under a just-in-time system. Backflush costing is used with a
finished goods trigger point. Additional information is as follows:
Actual conversion costs $1 740 000
Standard materials costs per unit $230
Standard conversion cost per unit $170
Units produced 23 700
Units sold 22 800
Record all journal entries for the monthly activities related to the above transactions if
backflush costing is used.
85) The only product of a company has an annual demand of 2000 units. The cost of placing an
order is $40 and the cost of carrying one unit in inventory for one year is $16.
Determine the economic order quantity.