Total ordering and holding costs, Marketing Management

A manufacturing company has determined from an analysis from its accounting and its production data for a certain part that its demand is 9000 units/annum and is uniformly distributed over the year. Its cost is Rs 2/unit and its ordering cost is Rs 40/order and Inventory carrying charge is 9% of the Inventory value. Further, it is known that the lead time is uniform and equal 8 working days and that the total working days in a year are 300.

Determine the:

(i) EOQ

(ii) Optimum no of orders/annum

(iii) Total ordering and holding costs associated with the policy of ordering an amount equal to EOQ

(iv) The reorder level

(v) The no of days stock at reorder level

(vi) The length of the inventory cycle

Posted Date: 3/2/2013 6:31:09 AM | Location : United States







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