Renbo Illuminati Ltd uses the EOQ to determine the optimal size of inventory orders.The following information has been established in respect of inventory line AB22:
A.Demand for the item in the period: 600 units
B. Cost per order: £6
C. Time required to fulfil orders on average: 5 days
D. Holding cost per unit: £4
Which of the above items of information are required in order to calculate the Economic Order Quantity (EOQ)?

Question

Renbo Illuminati Ltd uses the EOQ to determine the optimal size of inventory orders.The following information has been established in respect of inventory line AB22: 
A.Demand for the item in the period: 600 units
B. Cost per order: £6
C. Time required to fulfil orders on average: 5 days
D. Holding cost per unit: £4
Which of the above items of information are required in order to calculate the Economic Order Quantity (EOQ)?

Quizplus · Accepted Answer

The EOQ formula requires the demand for the item (A), the cost per order (B), and the holding cost per unit (D). The time to fulfill orders (C) is not needed for the EOQ calculation.

Renbo Illuminati Ltd Uses the EOQ to Determine the Optimal