Figure 24-2 Hapsburg Manufacturing Purchases Components Produced by Little Company in the in the Manufacture

Multiple Choice

Figure 24-2
Hapsburg Manufacturing purchases components produced by Little Company in the manufacture of its main product. For the next year, Hapsburg expects to use a total of 20,000 parts. Hapsburg typically orders 2,000 units at a time. The cost of placing an order is £100, and the average annual cost of carrying one unit of inventory is £5.
-Refer to Figure 24-2. Hapsburg's total ordering cost is

A) £1,000.
B) £5,000.
C) £10,000.
D) £500.