EOQ Calculation
- Susannie Tiempo (Unlicensed)
Definition of eoq:
If the holding cost is 0 then the eoq is the ceiling of the square root of 2 * the demand
If the holding cost is not 0, then the eoq the ceiling of the square root of 2 * the demand * the order cost / the holding cost
Definition of demand:
The demand is the number of frame used between 2 dates - the quantity in the warehouse
If the demand is less than or equal to 0, then the demand is the number of frames used
Definition of order cost:
The demand * the cost
Definition of holding cost:
The number of breakages * cost + the holding cost in the warehouse
Definition of daily usage:
Given 2 dates and the working days of a week, the daily usage is the number of frames used divided by the number of working days between the 2 selected dates
Definition of minimum quantity:
The daily usage * the number of lead days + the safety stock
Definition of maximum quantity:
The minimum quantity + the EOQ