Mathematics: Afirm that stocks lightbulbs gathers the following information: demand = 19,500 units per year, ordering cost = $25 per order, holding cost = $4 per unit per year. the firm wants to calculate the: a) eoq for the lightbulbs. b) annual holding costs for the lightbulbs. c) annual ordering costs for the lightbulbs.

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Afirm that stocks lightbulbs gathers the following

kaylaelaine18

10.01.2022

Step-by-step explanation:

Demand = 19,500 units per year (D)

Ordering cost = $25 per order (O)

Holding cost = $4 per unit per year (C)

a) $EOQ=\sqrt{ \frac{2\times D\times O}{C}}$

$EOQ=\sqrt{ \frac{2\times 19,500\times 25}{4}}$

= $\sqrt{\frac{975000}{4}}$

= $\sqrt{243,750}$

= 493.71044 ≈ 494

b) Annual holding cost = $4\times(\frac{Q}{2})$

= $4\times(\frac{494}{2})$

= 4 × 247

= 988

c) Annual ordering cost = $O\times(\frac{D}{Q} )$

= $25\times(\frac{19,500}{494} )$

= 25 × 39.47

= 986.75

AOQ = 494

Annual holding cost = 988

Annual ordering cost = 986.75

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