Brendan and Roscoe are college friends planning a skiing trip to Killington before the New Year. They estimated the following costs for the trip: Estimated Costs Cost Driver Activity Allocation
Brendan Roscoe
Food $550 Pounds of food eaten 24 26
Skiing 240 # of lift tickets 3 0
Lodging 320 # of nights 4 4
$1,110

Required:
a. Brendan suggests that the costs be shared equally. Calculate the amount each person would pay.
b. Roscoe does not like the idea because he plans to stay in the room rather than ski. Roscoe suggests that each type of cost be allocated to each person based on the above listed cost driver. Using the activity allocation for each person, calculate the amount that each person would pay based on his own consumption of the activity.

Ardmore farm and seed has an inventory dilemma. they have been selling a brand of very popular insect spray for the past year. they have never really analyzed the costs incurred from ordering and holding the inventory and currently fave a large stock of the insecticide in the warehouse. they estimate that it costs $25 to place an order, and it costs $0.25 per gallon to hold the spray. the annual requirements total 80,000 gallons for a 365 day year.a. assuming that 10,000 gallons are ordered each time an order is placed, estimate the annual inventory costs.b. calculate the eoq.c. given the eoq calculated in part b., how many orders should be placed and what is the average inventory balance? d. if it takes seven days to receive an order from suppliers, at what inventory level should ardmore place another order?