Determine the Economic Order Quantity in Excel for: Price of Product: .........$150 Savings Rate: .........12% Annual Usage:

Question:

Determine the Economic Order Quantity in Excel for:

Price of Product: .........$150

Savings Rate: .........12%

Annual Usage: ..........16240

Cost of transportation: ......$200/order

Cost of PO preparation: .......$60/order

Warehouse Rental: ........$8/piece.

Economic Order Quantity
Economic order quantity (EOQ) is the ideal order quantity a company should purchase to minimize inventory costs such as holding costs, shortage costs, and order costs. This production-scheduling model was developed in 1913 by Ford W. Harris and has...