Economic Order Quantity & Total Cost Find the EQQ AND TC assuming the following: P = $5

Question:

Economic Order Quantity & Total Cost

Find the EQQ AND TC assuming the following:

P = $5

D= $20000

O= $10

I= $19%

H=$75

A. Find the Economic Order Quantity (EOQ)

B. Find the Total Cost of the product for the year

C. Gives the constant demand for the product, how many orders will be made in 1 year?

D. Give the demand and the lag time of 5 days between order and receipt, how many units will be in stock when you place an order?

E. Gives the constant demand, how many days are between order?

F. What is the carrying cost?

G. What is the opportunity cost?

H. What is the cost of the average inventory?

I. What is the volume of the average inventory?

J. The hospital has only $90,000 budgeted for the product. What is the new price the hospital must negotiate with the vendor to make budget?

Economic Order Quantity
Economic order quantity (EOQ) is the ideal order quantity a company should purchase to minimize inventory costs such as holding costs, shortage costs, and order costs. This production-scheduling model was developed in 1913 by Ford W. Harris and has...