Week 3 - EOQ Activity - Economic Order Quantity Demand = Cost per item = \$ A= \$ B= \$ C= EOQ value = \$ EOQ units = Annual Ordering Cost = Annual

# Week 3 - EOQ Activity - Economic Order Quantity Demand...

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Economic Order Quantity Compute the necessary values below to find the MOST Demand = 12,000 Annual Requirements or Demand Cost per item = \$ 160.00 Purchase cost per Unit A = \$ 1,920,000 Annual Usage, in dollars B = \$ 115.00 Administrative costs per order of placing the order C = 28% Carrying costs of the inventory (expressed as an annual EOQ value = \$ 39,713.26 (exact value) EOQ units = 248 (rounded number) Annual Ordering Cost = in dollars Annual Inventory Holding Cost = in dollars TOTAL Annual Cost = in dollars Using this CONTINUIOUS inventory management system, every time that you need When to order is another question…. See the next assignment to compute the Reor Why are these two values not exactly equal, as seen on the chart?
T economical quantity to order! percentage of the inventory dollar value) to order this item, you buy EOQ of them! rder Point. \$/year \$/order 0 100 200 300 \$- \$10,000 \$20,000 \$30,000 \$40,000 \$50,000 \$60,000 Invento Quantity per Ord Annual Cost
400 500 600 ory Costs Holding Cost Ordering Costs Total Cost der
Demand = 12,000 Annual Requirements or Demand Cost per item = \$ 160.00 Purchase cost per Unit B = \$ 115.00 Administrative costs per order of placing the order C = 28% Carrying costs of the inventory (expressed as an annual perce