For an EOQ ordering quantity of 750 units, an ordering cost of
$5 per order, a...
For an EOQ ordering quantity of 750 units, an ordering cost of
$5 per order, a holding cost of $10 per unit per year, and an
annual demand of 900 units, what is the annual total cost for this
value of Q?
1. A. (EOQ) Calculate the EOQ quantity
given:
a. Fixed cost per order of $40
b. holding cost per inventory unit of
$2.00
c. estimated demand for inventory of
200,000
Solve EOQ using the information listed
above:
B. Calculate the total cost associated the EOQ amount calculated
in part A:
C. The company wants to keep Safety Stock of an additional; 8
units. Calculate the cost associated with the safety stock and the
total cost of the EOQ amount...
If EOQ = 360 units, order costs are $5 per order, and carrying
costs are $0.20 per unit, what is the usage in units? How many
orders will be placed in a year if there are 250 working days per
year and lead time is 5 days?
One company operates 300 days per year. The economic order
quantity (EOQ) is 250 units. Annual demand is 5000 units. The
expected time between orders will be: 15 days20 days1.2 days16.6 daysNone of the above
Using the EOQ model, if a firm's order quantity is 500 units
and its annual holding cost is greater than its annual setup cost,
then what can we say about the optimal order quantity?
A. Optimal order quantity = 500 units
B. Optimal order quantity < 500 units
C. Optimal order quantity > 500 units
D. Not enough information is given to answer the question
1. Consider the basic EOQ model (no uncertainty). Optimal order
quantity (Q ∗) is 1,800 units. What is the average inventory level
(I ∗)?
a. 900 units
b. 1,800 units
c. 600 units
d. 1,000 units
e. 3,600 units
2. Consider the basic EOQ model (no uncertainty). Annual holding
cost (AHC) is $2,400. Find annual ordering cost (AOC).
a. Cannot be answered because there is missing information
b. AOC=$0, since there is no uncertainty
c. $1,200, since AOC=AHC/2 at economic...
Ricky Orange’s annual demand is 12 500 units. Ordering cost is
RO. 100 per order. Holding cost is estimated at 20% of product cost
which is RO. 50 per unit. The firm works for 50 weeks per year and
each week has 5 days.
Calculate:
a) Economic order quantity.
b) Number of orders to be placed per year.
c) Daily usage quantity.
...
Find the EOQ, the total annual cost associated with the economic
order quantity, the reorder point, number of orders per year and
the time between orders.
Annual Demand
15,600 units
Weeks Operating
52 weeks/year
Set up Cost
$60/order
Holding rate
20%
Unit cost
$80 /unit
Lead-Time
5 weeks
Consider a basic economic order quantity (EOQ)
model with the
following characteristics:
Item cost:
$15
Item selling price:
$20
Monthly demand:
500 units (constant)
Annual holding cost:
$1.35 per unit
Cost per order:
$18
Order lead time:
5 working days
Firm's work year:
300 days (50 weeks @ 6 days per week)
Safety stock:
15% of monthly demand
For this problem, determine the values of:
Q* the optimal order quantity and reorder
point.
Select one:
a. 400 and 100
b....
COST ACCOUNTING
Companies can use the Economic Order Quantity (EOQ) method to
maintain the existing inventory conditions within the company,
especially to reduce the existing fixed costs that can arise from
the purchase of goods using expedition services. For example,
buying goods with Full Container Load (FCL) and Less Container Load
(LCL), the LCL fixed cost will be greater because the goods
purchased are small but the tariff for sending goods from the
supplier to the factory requires no small...
Which of the following is NOT an assumption of the traditional economic order quantity (EOQ) model?
a. Holding and ordering costs are stable and known.
b. Demand is constant and known.
c. Supply lead time is constant and known.
d. Quantity discounts are possible.
Kim’s Nail Salon uses a weighted moving average method to forecast demand. She assigns a weight of 5 to the previous month’s demand, 3 to demand two months ago, and 2 to demand three months ago....