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  • caseACT - Planned Shortage

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    namnguyen.31221020873
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    The document summarizes an EOQ model with planned shortages to determine the optimal order quantity and maximum shortage. It provides the model inputs of annual demand, setup cost, unit holding cost, and unit shortage cost. The optimal order quantity is calculated as 715.9 units and optimal maximum shortage is 257 units. The total annual variable cost given this solution is $1,927.53.

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    ERP excercise

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    The document summarizes an EOQ model with planned shortages to determine the optimal order quantity and maximum shortage. It provides the model inputs of annual demand, setup cost, unit holding cost, and unit shortage cost. The optimal order quantity is calculated as 715.9 units and optimal maximum shortage is 257 units. The total annual variable cost given this solution is $1,927.53.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    11 views2 pages

    caseACT - Planned Shortage

    Uploaded by

    namnguyen.31221020873
    The document summarizes an EOQ model with planned shortages to determine the optimal order quantity and maximum shortage. It provides the model inputs of annual demand, setup cost, unit holding cost, and unit shortage cost. The optimal order quantity is calculated as 715.9 units and optimal maximum shortage is 257 units. The total annual variable cost given this solution is $1,927.53.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    EOQ Model with Planned Shortage (Analytical Version)

    Data
    D= 6000 (Demand /year)
    K= $ 115.00 (Setup cost)
    h= $ 4.20 (unit holding cost)
    p= $ 7.50 (unit shortage cost)

    Decision
    Q (S.P)= 715.9409393 (optimal order quantity) SQRT((h+p)/(p)) * SQRT((2KD)/(h))
    S= 257.00443975 (optimal maximun shortage) ( (h)/(h+p) )* Q

    Q (Nor)=
    Result
    Maximum Inventory Level 458.93649955

    Annual Setup Cost $ 963.77 KD/Q


    Annual Holding Cost $ 617.80 h* (Q-S)/2 * (Q-S)/Q
    Annual Shortage Cost $ 345.97 p* S/2 * S/Q
    Total Variable Cost $ 1,927.53

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