Homework Answers
Annual demand =D = 15000
Holding cost = H = $4 per container
Ordering cost = S= $ 5 per order
EOQ can be calculated as
= 193.65
EOQ = 193.65
Total ordering cost = (D/Q) * ordering cost per order
= (15000/193.65) * 5
Total ordering cost = $387.30
Total Holding cost = (Q/2) * Holding cost per container
= (193.65/2) * 4
Total Holding cost = $ 387.24
Total Cost = Total ordering cost + Total Holding cost
= 387.30 + 387.24
Total annual Cost = $774.54
======================================END==============================================
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