1. Calculate Economic Order Quantity (EOQ), number of orders, annual ordering costs, annual carrying costs and total inventory costs from the following: Annual consumption: 6000 units Cost of placing one Order: RO 60 Carrying cost per unit: RO 2 2. Find out the EOQ, Annual ordering cost and annual holding cost from the following information. The demand is 19500 units per year, holding cost is RO 4 per unit for a year and ordering cost is RO 25 order. 3. Find out the ordering cost from the following information, Annual demand is 240 units, holding cost RO 4 per unit for a year and EOQ is 60 units. 4. If the price of the material is RO 15 per unit and the annual consumption is 4000 units, the interest and store keeping charges are 20% of the value and the cost of placing of an order and receiving the goods is RO 60, how much material should be ordered at one time? 5. Alexander pump LLC uses about 75000 valves per year and the usage is fairly constant at 6250 units per month. The valve cost of RO 1.50 per unit when bought in large quantities, and the carrying cost is estimated to be 20% of average inventory investment on an annual basis. The cost to place an order and process the delivery is RO18. It takes 45 days to receive delivery from the date of an order and a safety stock of 3250 vales is desired. You are required to determine. a. The most economical order quantity and frequency of orders. b. The most economical order quantity if the valves cost is RO 4.50 each instead of RO 1.50 each
1. Calculate Economic Order Quantity (EOQ), number of orders, annual ordering costs, annual carrying
costs and total inventory costs from the following:
Annual consumption: 6000 units
Cost of placing one Order: RO 60
Carrying cost per unit: RO 2
2. Find out the EOQ, Annual ordering cost and annual holding cost from the following information. The
demand is 19500 units per year, holding cost is RO 4 per unit for a year and ordering cost is RO 25
order.
3. Find out the ordering cost from the following information, Annual demand is 240 units, holding cost RO
4 per unit for a year and EOQ is 60 units.
4. If the price of the material is RO 15 per unit and the annual consumption is 4000 units, the interest and
store keeping charges are 20% of the value and the cost of placing of an order and receiving the goods
is RO 60, how much material should be ordered at one time?
5. Alexander pump LLC uses about 75000 valves per year and the usage is fairly constant at 6250 units
per month. The valve cost of RO 1.50 per unit when bought in large quantities, and the carrying cost is
estimated to be 20% of average inventory investment on an annual basis. The cost to place an order
and process the delivery is RO18.
It takes 45 days to receive delivery from the date of an order and a safety stock of 3250 vales is
desired.
You are required to determine.
a. The most economical order quantity and frequency of orders.
b. The most economical order quantity if the valves cost is RO 4.50 each instead of RO 1.50 each
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