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Setting Different Levels and Recorder point : Just to avoid the chances of over and under investment as well as running short of an item during the course of production minimum and maximum limits for each item of inventory should be fixed. While fixing the minimum and maximum levels, recorder point should also be fixed in advance.
Fixing Economic Recorder Quantity : It is basic inventory problem to determine as to how much quantity of a particular item should be ordered at a time considering various costs. In determining the economic order quantity ( EOQ) the two opposing costs ordering cost and carrying cost should be balanced.
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VK Ltd a multi product company, furnishes you the following data relating to the year 2000. First half sales Second half sales Sales Rs.45000 Rs.50000 Total cost Rs.40000 Rs.43000
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