Final answer:
The total annual stockholding cost is determined by adding the order quantity to the safety stock to calculate the total stock held and then multiplying by the stockholding cost per kg. The accurate calculation leads to a final answer of GHS3,840 for the total annual stockholding cost.
Step-by-step explanation:
The question presents a scenario involving inventory management and requires calculating the total annual stockholding cost for raw material based on the given data. To determine the annual stockholding cost, you add the safety stock to the order quantity to find the total quantity of stock held over the year and then multiply this by the stockholding cost per kg per annum.
The safety stock is 1,200 kg and the order quantity is 2,000 kg, totalling 3,200 kg of material to be held in stock over the year. The stockholding cost is GHS1.20 per kg per annum. So, the calculation for the annual stockholding cost would be:
Total Annual Stockholding Cost = Total Quantity of Stock Held × Stockholding Cost per kg
Total Annual Stockholding Cost = (2,000 kg + 1,200 kg) × GHS1.20/kg
Total Annual Stockholding Cost = 3,200 kg × GHS1.20/kg
Total Annual Stockholding Cost = GHS3,840
Therefore, option d. GHS3,840 is the correct total annual stockholding cost.