To calculate the EOQ, days between orders, and optimal annual cost, specific data like demand, ordering costs, and holding costs are essential. Formulas for each calculation are provided, with the final figures rounded to the nearest whole number.
To determine the Economic Order Quantity (EOQ) and other related metrics, we would need specific details like the annual demand, ordering costs, and holding costs. Nevertheless, I can explain the formulas used to calculate EOQ, the number of days between orders, and the optimal annual cost of ordering and inventory.
The EOQ formula is given by:
EOQ = √((2DS)/H)
Where:
D = Demand in units per year
S = Ordering cost per order
H = Holding cost per unit per year
Once you have the EOQ, you can calculate the number of orders per year as:
Number of Orders = D / EOQ
And then, derive the number of operating days between orders by dividing the number of operating days in a year by the number of orders:
Days between Orders = 250 / Number of Orders
Lastly, the optimal annual cost of ordering and inventory is the sum of the ordering costs and the holding costs:
Optimal Annual Cost = (D / EOQ) × S + (EOQ / 2) ×H
These calculations should be rounded to the nearest whole number when reported.