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# Calculating the EOQ in the given case

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Shoe Shine is a local retail shoe store located on the north side of Centerville. Annual demand for a popular sandal is 500 pairs, and John Dirk, the owner of Shoe Shine, has been in the habit of ordering 100 pairs at a time. John estimates that the ordering cost is \$10 per order. The cost of the sandal is \$5 per pair.

For John's ordering policy to be correct, what would the carrying cost as a percentage of the unit cost have to be? If the carrying cost were 10% of the cost, what would the optimal order quantity be?

https://brainmass.com/math/geometry-and-topology/calculating-the-eoq-in-the-given-case-462411

#### Solution Preview

For John's ordering policy to be correct, what would the carrying cost as a percentage of the unit cost
have to be?

Total demand= D=500 pairs per year ...

#### Solution Summary

Solution determines the carrying cost and optimal order quantity in the given case.

\$2.19