Module+13000+XVI.+Formulas


 * XVI. Module 13000 Formulas wxa**

1.TC= P*D/Q+C*Q/2 = Ordering (or setup) cost +Carrying cost // *TC=the total ordering (or setup) and carrying cost // // *P=the cost of placing and receiving an order (or the cost of setting up a production run) // // *Q= the number of units ordered each time an order is placed (or the lot size for production) // // *D= the known annual demand // // *C= the cost of carrying one unit of stock for one year //

2. Reorder point= Rate of usage* Lead time = (Average rate of usage * Lead time) +Safety stock

3.