Details :
Buy price - Rs 200
Cost / order - Rs 100
Carrying order - Rs 20 / unit / yr.
Total carrying cost & ordering cost - Rs. 4000
Find EOQ ?
Please help me out.
7 Replies
Rachit
(Ca-Final Article.)
(565 Points)
Replied 12 April 2011
Sir you had not provide the annual usage?????
Arniv Sharda
(CA Final)
(3006 Points)
Replied 12 April 2011
ans is 200
our carrying cost would be 2000 as carrying and ordering cost is always equal at eoq level
so calculation is
half of eoq*20=2000
therefor ans is 200
cheers
mohsin
(IPCC)
(94 Points)
Replied 12 April 2011
Total carrying cost & ordering cost= root2AOC
given Total carrying cost & ordering cost = 4000
A=?
o=100
c=20
by substituting,
4000=root 2*A*100 *20
4000 * 4000 =4000A
therefore annual consumpton(A) = 4000
EOQ = root 2AO/C
=root 2*4000*100/20
=root40000
EOQ = 200 UNITS
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