Guys, I have a doubt in question 31 of chapter 1 of AMA. The concept is Just in Time. I have attached the question and answer below. In the comparison between current policy and JIT, 'opportunity cost' (line no. 3) and 'other carrying cost' (line no. 4) are taken. For both of these, the amount is calculated on 1000 packages or 100 packages while the requirement is 13000 packages in a year. Can someone please explain why 13000 is not taken ? Also, the calculation goes like this: 1/2 * 1000 packages*140*15%. Can someone please explain why it's multiplied by 1/2 ?
1 Replies
CA Rashmi Gandhi
(Chartered Accountant)
(86323 Points)
Replied 07 May 2017
Its carrying cost of maintaining the stock.
Generally carrying cost calculated on average stock. Thats why 1/2 is multiplied.
Secondly we maintain stock of goods which are ordered by us, here in existing policy me make 13 orders of 1000 packages each & in just in time 130 orders of 100 packages.
We have to maintain/carry stick of 1000 or 100 only not13000
So carrying cost calcuated on average basis on ordered qty
Generally carrying cost calculated on average stock. Thats why 1/2 is multiplied.
Secondly we maintain stock of goods which are ordered by us, here in existing policy me make 13 orders of 1000 packages each & in just in time 130 orders of 100 packages.
We have to maintain/carry stick of 1000 or 100 only not13000
So carrying cost calcuated on average basis on ordered qty
Recent Topics
- 80D claim for payment paid by parent
- TDS on purchase of Flat under subvention scheme be
- Nznxnc call me at the end of the day of the
- Nsje snswk fjw ed le ene djff ne enje ejdd rejje
- Hxjcif the day I have been in touch with me and
- Iska djd djrbdsjebshe sir ur rei ejr reinr the jr
- GST registration for medical shop in Karnataka
- Hsshs me know if you are free number of the
- Chu Kang and the situation of the situation and I
- How to reverse wrong transaction payment in phonep
Related Threads
CAclubindia
