Workbook1

AnalystD Demand per year 5000A Order Cost $100 v Unit Price $2 r Carrying Cost $/$/year 0.28

EOQ 1336Q 1336

TRC 748

D Demand per year 5000A Order Cost $100 v Unit Price $2 r Carrying Cost $/$/year 0.28

Quantity (in units)

Retailer Retailer

$25

500 500

1140 390

5000 5000100 $25

2 $2 0.28 0.281336 500

EOQ calculated as per the data given

Current Order qty placed by supplier

Analyst recommendation

0<Q<100 100>/=QDemand D 1200

Order Cost A $24 Unit Price v 20 19.5

Carrying Cost r 0.30v eff 19.78696337

Q 98 174

Qb 100F 50

TRC(EOQ) 24675

TRC(Qb) 24588 24426.79387

TRC(EOQ)<TRC(Qb)

Best Order Qty 98

First Order QuantityMonth Sequential Number Requirements(in units) Demand

Jan 1 200 200Feb 2 300 300Mar 3 180 180Apr 4 70 70May 5 50 50Jun 6 20 20Jul 7 10 10

Aug 8 30 30Sep 9 90 90Oct 10 120 120Nov 11 150 150Dec 12 190 190

1410 1410

A $160 r (per month) $0.02

v $5

EOQ 613

TRC 736

First Order QuantityOrder Qty Holding Qty Holding Cost Ordering Cost Period Cost

613 413 41 $160 2010 113 11 $0 11

613 546 55 $160 2150 476 48 $0 480 426 43 $0 430 406 41 $0 410 396 40 $0 400 366 37 $0 370 276 28 $0 280 156 16 $0 160 6 1 $0 1

613 430 43 $160 203881

Demand 200 300 180 70 50 20Month 1 2 3 4 5 6

1 $160 $190 $226 $247 $267 $277 2 $320 $338 $352 $367 $375 3 $350 $357 $367 $373 4 $386 $391 $395 5 $407 $409 6 $427 789

101112

A $160 r (per month) $0.02

v $5 rv(per month) 0.1

Starting inventory 0 660 360 180 110 60Replenishment 860 0 0 0 0 0Requirement 200 300 180 70 50 20

Ending Inventory 660 360 180 110 60 40

10 30 90 120 150 1907 8 9 10 11 12

$283 $304 $376 $484 $634 $843 $380 398 $461 $557 $692 $882 $377 389 $443 $527 $647 $818 $398 410 $455 $527 $632 $784 $411 420 $456 $516 $606 $739 $428 434 $461 $509 $584 $698 $437 $440.00 $458 $494 $554 $649

$443 $452 $476 $521 $597 $464 $476 $506 $563

$536 $551 $589 $636 $655

$666

Total40 30 0 460 340 190 00 0 550 0 0 0 1410

10 30 90 120 150 190 141030 0 460 340 190 0 2430

Total replenishment cost $320 Total carrying cost 243

Total replenishment plus carrying cost $563

Month Sequential Number Requirements(in units) MonthJan 1 200 1Feb 2 300 2Mar 3 180 3Apr 4 70 4May 5 50 5Jun 6 20 6Jul 7 10 7

Aug 8 30 8Sep 9 90 9Oct 10 120Nov 11 150Dec 12 190 1

1410 23

A $160 4r (per month) $0.02

v $5

EOQ 613

TRC 736

Holding cost per month 0.100

Silver MealDemand Sum Qty Order Cost Holding Cost TRCUT/T

200 200 $160 $ - $160 300 500 $160 $ 30 $95 180 680 $160 $ 66 $75 70 750 $160 $ 87 $62 50 800 $160 $ 107 $53 20 820 $160 $ 117 $46 10 830 $160 $ 123 $40 30 860 $160 $ 144 $38 First Buy90 950 $160 $ 216 $42

90 90 $160 $ - $160 120 210 $160 $ 12 $86 150 360 $160 $ 42 $67 190 550 $160 $ 99 $65 Second Buy

$320 $ 243.00 $563

Month Sequential Number Requirements(in units) MonthJan 1 200 1Feb 2 300 2Mar 3 180 3Apr 4 70 4May 5 50 5Jun 6 20Jul 7 10


1410 67

A $160 8r (per month) $0.02

v $5

EOQ 613

TRC 736


Least Unit CostDemand Sum Qty Order Cost Holding Cost Lot Cost Cost Per Item

200 200 $160 $ - $160 $0.800 300 500 $160 $ 30 $190 $0.380 180 680 $160 $ 66 $226 $0.332 70 750 $160 $ 87 $247 $0.329 First buy50 800 $160 $ 107 $267 $0.334

50 50 $160 $ - $160 $3.200 20 70 $160 $ 2 $162 $2.314 10 80 $160 $ 4 $164 $2.050 30 110 $160 $ 13 $173 $1.573 90 200 $160 $ 49 $209 $1.045

120 320 $160 $ 109 $269 $0.841 150 470 $160 $ 199 $359 $0.764 190 660 $160 $ 332 $492 $0.745 Second buy

$320 $ 419.00 $739

CNT Buy1 12 13 14 1

1 22 23 24 25 26 27 28 2



1410Month

A $160 1r (per month) $0.02 2

v $5 34

EOQ 613 56

TRC 736 78

Holding cost per month 0.100 910

T* 0.126869105106371 111.52 12

1 monthMonth

123456789

10

1112

PPBDemand Order Qty Holding Cost Ordering Cost

200 200 $ - $160 $160.00 300 500 $ 30 $160 $130.00 180 680 $ 66 $160 $94.00 70 750 $ 87 $160 $73.00 50 800 $ 107 $160 $53.00 20 820 $ 117 $160 $43.00 10 830 $ 123 $160 $37.00 30 860 $ 144 $160 $16.00 First order90 950 $ 216 $160 ($56.00)

120150190

Demand Order Qty Holding Cost Ordering Cost200 860 0 160300 30180 6670 8750 10720 11710 12330 14490 90 0 160 160

120 210 12 160 148150 360 42 160 118190 550 99 160 61 second order

Demand Order Qty Holding Cost Ordering Cost200 860 1603001807050201030 14490 550 160

120

150190 99

243 320 563



1410

A $160 r (per month) $0.02 $0.05

v $5

EOQ 613.19

TRC 736


T* 0.4348853820356285.22

56 months POQ

POQDemand Order Qty Holding Cost Ordering Cost Period Cost

200 820 62 $160 $222 300 0 32 $0 $32 180 0 14 $0 $14 70 0 7 $0 $7 50 0 2 $0 $2 20 0 0 $0 $0 10 590 58 $160 $218 30 0 55 0 $55 90 0 46 $0 $46

120 0 34 0 $34 150 0 19 $0 $19 190 0 0 0 $0

1410 329 $320 $649

XL 20σ 4.2

20+k4.2

p1 0.9 0.94 0.98 0.999safety factor k 1.28 1.55 2.05 3.09safety stock ss 5.38 6.53 8.63 12.98re-order point S 25.38 26.53 28.63 32.98

p1 ss0.9 5.38

0.94 6.530.98 8.63

0.999 12.98

0.88 0.9 0.92 0.94 0.96 0.98 1 1.020.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

CSL vs SS

CSL vs SS

P1 0.94 0.94

D 1000 1000

EOQ 200 200

L 2 weeks 1 week

v 0.8 0.85

other 0.2

Month Sequential Number Requirements(in units) 10 62 12Jan 1 200 1 2 3Feb 2 300 $54 $78.80 $88 Mar 3 180 $108 $113 Apr 4 70 $133 May 5 50Jun 6 20Jul 7 10

Aug 8 30Sep 9 90Oct 10 120Nov 11 150Dec 12 190

1410

A $160 r (per month) $0.40

v $1

EOQ 307

TRC 1472

130 154 129 88 52 124 1604 5 6 7 8 9 10

$244 $491 $749 $960 $1,106 $1,502 $2,078 $217 $402 $608 $784 $909 $1,256 1556.4$185 $308 $463 $604 $737 $ 1,034 1482.4$142 $204 $307 $413 $570 817.6 1201.6

$196 $248 $318 $454 652.8 972.8$250 $285.60 $327.20 549.6 805.6

$302 $322.80 498 690$340 $432 609.6

$486 $550 $540

238 4111 12

$3,030.40 $3,210.80 2624.8 2788.82244 2391.61868 1999.21544 1658.8

1281.6 13801070.8 1152.8895.2 960.8740.4 789.6$635 668$594 $610

$648

Date post:	19-Dec-2015
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