Quality Progress, February 2005, reports on improvements in customer satisfaction and loyalty made by Bank of America. A key mea
1 answer:
You might be interested in
Solution :
The optimal order quantity, EOQ =
EOQ =
= 115.47
The expected number of orders =
= 17.32
The daily demand = demand / number of working days
= 8.33
The time between the orders = EOQ / daily demand
= 13.86 days
ROP = ( Daily demand x lead time ) + safety stock
= 76.64
The annual holding cost =
= 207.85
The annual ordering cost =
= 207.85
So the total inventory cost = annual holding cost + annual ordering cost
= 207.85 + 207.85
= 415.7