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Ahmad Enterprise requires 40,000 gallons of material annually, the cost of placing an order is RM40; the annual carrying cost per gallon is RM3.
Ahmad Enterprise requires 40,000 gallons of material annually, the cost of placing an order is RM40; the annual carrying cost per gallon is RM3. Required: (a) Determine the EOQ from potential order size of 300, 400, 500, 600, 700 and 800 gallons by constructing a table. (Refer to the sample given) 2 Order Number of size orders Total order costs (RM) Average Inventory Total carrying cost ($) Total order & carrying cost (RM) (b) Use the EOQ formula to verify your answer to part (a) 2/5
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