DEMAND = 8000
ORDERING COST = 40
HOLDING COST % = 30 %
EOQ = SQRT(2 * D * S / H), WHERE D = DEMAND, S = ORDERING COST, H = HOLDING COST
ANNUAL HOLDING COST = (Q* / 2) * H
ANNUAL ORDERING COST = (DEMAND / Q*) * S
ANNUAL PURCHASE COST = DEMAND * PER UNIT COST IN PARTICULAR PRICE BRACKET
TCI = AHC + AOC + APC
OPTIMAL ORDER QUANTITY = 8000
TOTAL COST FOR OPTIMAL QUANTITY = 119640
# |
MINIMUM QUANTITY |
MAXIMUM QUANTITY |
UNIT COST |
ADJUSTED HOLDING COST |
Q |
Q* |
AHC |
AOC |
APC |
TCI |
1 |
0 |
199 |
20 |
6 |
327 |
199 |
199 / 2 = 597 |
8000 / 199 * 40 = 1608.04 |
8000 * 20 = 160000 |
597 + 1608.04 + 160000 = 162205 |
2 |
200 |
7999 |
19 |
5.7 |
335 |
335 |
335 / 2 = 954.75 |
8000 / 335 * 40 = 955.22 |
8000 * 19 = 152000 |
954.75 + 955.22 + 152000 = 153910 |
3 |
8000 |
& more |
13 |
3.9 |
405 |
8000 |
8000 / 2 = 15600 |
8000 / 8000 * 40 = 40 |
8000 * 13 = 104000 |
15600 + 40 + 104000 = 119640 |
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