Question

Calculate EOQ from the details:
Annual usage -Rs. 120000, Cost of
placing one order - Rs. 60, Annual
carrying cost-10 percent of
inventory value​

Answer 1

Step-by-step explanation:

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Answer 2

Answer:

The economic order quantity is $12,000.$

Step-by-step explanation:

We know that the economic order quantity is given by formula,

           $\sqrt{\frac{2*A*D}{C} }$

Where $A$ is the cost of placing one order, $Rs.60.$

$D$ is the annual demand, $Rs.120000.$

and $C$ is the annual carrying cost of inventory value $10%=0.1.$

Therefore,

$EOQ=\sqrt{\frac{2*120000*60}{0.1} } =12000.$