Purchase Solution

Economic Order Quantity Calculations

Not what you're looking for?

Ask Custom Question

Sales are estimated to be 4,500 (d) units annually at $3,000 each. The cost of each unit for Taylor Incorporated is $1,200 (v). Inventory carrying cost is (c) 5% of the cost value of the device. Order placement (p) cost is $60.

I need to know the Economic Order Quantity (EOQ).

I already have the equation I just not sure if I'm putting the items in the correct spot.

EOQ =2PD/CV

I placed the p,d,c, and v where I think they go! My answer is 113841.9958. I'm just not certain that I worked this problem correctly. Is this correct?

Purchase this Solution
Solution Summary

The expert examines economic order quantity calculations.

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
Recent Feedback
  • "Your explanation to the answers were very helpful."
  • "What does 1 and 0 means in the repair column?"
  • "Went through all of the formulas, excellent work! This really helped me!"
  • "try others as well please"
  • "Thank you, this helped a lot. I was not sure how to plug in those numbers to a formula. This was a great help. Now I have to figure out how to explain cost of capital is used in net present value analysis, and how cost of capital is used in net present value analysis. This stuff gets confusing."
Purchase this Solution
Free BrainMass Quizzes
Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.

Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Production and cost theory

Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.

View More Free Quizzes
Related BrainMass Solutions

  • Accounting: LIFO,FIFO and Economic Order Quantity

    (Show your work/calculations/formulas) Jerry's Retail expects total sales of 2,000 units. The firm estimates an ordering cost of $7.50 per order, with an inventory cost of $0.70 per unit. What is the economic ordering quantity?

  • Questions regarding economic order quantity

    This solution provides answers to questions regarding economic order quantity.

  • Magyar Golf Supplies

    221688 Economic Order Quantity and Average Cycle Stock Michael Traci, the very new inventory manager at Magyar Gold Supplies, is considering using the economic order quantity for controlling inventory.

  • Economic Order Quantity: Doritos and Pepsi

    The solution determines the economic order quantity.

  • Import Beer product line: Method for optimal ordering quantities

    Optimal order quantity Optimal order quantity determines how many units are to be ordered and the method to do so is to use the economic order quantity model.

  • The Equation Method for Computing Economic Order Quantity

    It's 2 x requirement x cost per order / holding cost. The answer is the square root of that answer. This solution calculates the economic order quantity for case A, B, and C. All calculations are provided.

  • Finding the Economic Order Quantity

    328655 Finding the Economic Order Quantity Question: Jerry's Retail expects a total sales of 2,000 units. The firm estimates an ordering cost of $7.50 per order, with an inventory cost of $0.70 per unit. What is the economic ordering quantity?

  • Operations Management Inventory Calculations

    The ability to calculate annual demand, annual holding costs, annual ordering costs, economic order quantity and average time between orders gives the knowledge order the right inventory at the right time and in the right quantity.

  • Inventory, Economic Quantity Model

    Answer: Given the following information: Demand per year D = 235,000 yards per year Ordering cost S = $250/order Carrying cost H = $1.65/yard/year Economic Order Quantity = EOQ =Sqrt((2SD)/H) = 8438.73 yards Minimum total annual inventory cost

View More Related Solutions