Which comprise insurance also cost of capital

Reference no: EM1378617

Q. Item X is a standard item stocked in a company's inventory of component parts. Each year firm, on a random basis, uses about 2,000 of item X, which costs $25 each. Storage costs, which comprise insurance also cost of capital, amount to $5 per unit of average inventory. Every time an order is placed for more items X, it costs $10.

Reference no: EM1378617

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