Given the following information determine the EOQ and Beginn

Given the following information determine the EOQ and Beginning Inventory: Amount Sold/Purchased per year = 300,000 units; Cost of Placing Order = $300; Cost of each item =$50 Carrying Cost as % Average Inventory = 25%; what is the EOQ in dollars?

Solution

Ans is a 3795

Price	50.00
Ordering costs	300.00
Annual Demand	300,000.00
Carrying cost(50*25%)	12.50
EOQ = under root(2*A*O/C)
EOQ = under root(2*300000*300/12.50)
EOQ = under root(600,000*24)
EOQ = under root(14,400,000)
EOQ =3,795 Approx