Millennium Liquors is a wholesaler of sparkling wines. Its most popular product is the French Bete Noire, which is shipped directly from France. Weekly demand is 45 cases. Millennium purchases each case for $120, there is a $300 fixed cost for each order (independent of the quantity ordered), and its annual holding cost is 25 percent.

1. What order quantity minimizes Millennium’s annual ordering and holding costs?

2. If Millennium chooses to order 300 cases each time, what is the sum of its annual ordering and holding costs?

3. If Millennium chooses to order 100 cases each time, what is the sum of the ordering and holding costs incurred by each case sold?

4. If Millennium is restricted to ordering in multiples of 50 cases (e. g., 50, 100, 150, etc.), how many cases should it order to minimize its annual ordering and holding costs? 5. Millennium is offered a 5 percent discount if it purchases at least 1000 cases. If it decides to take advantage of this discount, what is the sum of its annual ordering and holding costs?

Lo.2, 3, 9 lori, who is single, purchased 5-years class property for $200,00 and 7-years class property for $420,000 on may 20, 2018. lori experts the taxable income derived form the business (without regard to the amount expensed under ⧠179) to be about $550,000. lori has determined that she should elect immediate ⧠179 expensing in the amount of $520,000, but she doesn’t know which asset she should completely expense under ⧠179. she does not claim any available additional first-year depreciation. a. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 5-year class asset. b. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 7-year class asset. c. what is your advice for lori? d. assume that lori is in the 24% marginal tax bracket and that she uses ⧠179 on the 7-year asset. determine the present value of the tax savings from the depreciation deductions for both assets. see appendix g for present value factors, and assume a 6% discount rate. e. assume the same facts as in part (d), except that lori decides not to use ⧠179 on either asset. determine the present value of the tax savings under this choice. in addition, determine which option lori should choose. f. present your solution to parts (d) and (e) of the problem in a spreadsheet using appropriate microsoft excel formulas. e-mail your spreadsheet to your instructor with a two-paragraph summary of your findings.