25 September 2016
After inviting tenders, two quotations are received as follows : supplier A -2.20 per unit and supplier B - 2.10 per unit plus 2000 fixed charges irrespective of units ordered. calculate order quantity for which total purchase price will be the same. considering all factors regarding production requirements and availability of finance , the purchase officer wants to place an order for 15000 units which supplier should he select? Please help I can't seem to solve this !
26 September 2016
At times, DONKEY method gives easy but sure results.... Find out the cost for each supplier, assuming the order for 15000 units is given Supplier A ----- 15000 units X 2.20 per unit = 33,000 Supplier B ----- (15000 units X 2.10 per unit) + 2000 =33,500 Now you tell which one should be selected?
Querist :
Anonymous
Querist :
Anonymous
(Querist)
26 September 2016
Supplier A But the ques. Is asking for the purchase price to be the same.. ?! Then I guess we'll have to find out the max quantity which can be purchased at the same cost.
26 September 2016
Oh i see......I thought after getting the answer you would be able to find it out by yourself....anyway...... How about the quantity of 20,000? Now please try to find out how I solved it?
Querist :
Anonymous
Querist :
Anonymous
(Querist)
27 September 2016
Oh yes I'm sorry I didn't get it at first. Thanks a ton!
27 September 2016
absolutely fine.... no problem.... If you want to solve it Arithmetically.....solve it like this the cost difference is 2.20 - 2.10 = 0.10 the fixed element is 2000 so the answer = 2000 divided by 0.10 = 20,000
Querist :
Anonymous
Querist :
Anonymous
(Querist)
27 September 2016
Ya bt fixed cost bhi thi to I thought exam mei wo accept na kre ans. To tbhi Maine arithmetically solve kra.