question archive What is the economic order quantity for the following inventory policy
What is the economic order quantity for the following inventory policy
Subject:AccountingPrice:9.82 Bought3
What is the economic order quantity for the following inventory policy. A firm sells 32,000 bags of premium
sugar per year. The cost per order is P100 and the firm experiences a carrying cost of P0.85 per bag. * [
Format: 1, 111
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2744 units
Step-by-step explanation
The economic order quantity is computed as;
=sqrt ((2*annual demand *ordering cost)/holding cost)
=sqrt ((2*32000*100)/0.85)
=sqrt (7529411.7647058823)
=2743.97736
=2744 units
