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Economic Order Quantity (EOQ)
A product sells at the rate of 5 per day and the company operates seven days per week. The order quanitity is 100. It takes 7 days for an order to be delivered. Carrying cost is $200 per unity per year.
Assume safety stock is 20 units
What is the maximum inventory?
What is the minimum inventory?
What is the average inventory?
What is the reorder point?
Currently, on-hand inventory is 50 and in-transit is 100. What amount should be ordered?
Currently, on-hand inventory is 50 and in-transit is 0. What amount should be ordered?
What is the annual cost of carrying the safety stock?
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