Economic Order Quantity Calculator

✖Fixed costs per order are the cost that does not change with an increase or decrease in the amount of goods or services produced or sold.ⓘ Fixed cost per order [Cf]			+10% -10%
✖Demand in units per year represents the total demands of the unit per year.ⓘ Demand in units per year [D]			+10% -10%
✖Carrying cost per unit per year refers to the total cost of holding inventory for a unit per year.ⓘ Carrying cost per unit per year [C_h]			+10% -10%

✖Economic order quantity is an equation for the inventory that determines the ideal order quantity a company should purchase for its inventory given a set cost of production, demand rate, and other variables.ⓘ Economic Order Quantity [EOQ]

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Formula

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Economic Order Quantity

Formula

`"EOQ" = ((2*"Cf"*"D")/"C"_{"h"})*(1/2)`

Example

`"285714.3"=((2*"500"*"2000")/"3.5")*(1/2)`

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Economic Order Quantity Solution

STEP 0: Pre-Calculation Summary

Formula Used

Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2)
EOQ = ((2*Cf*D)/C_h)*(1/2)
This formula uses 4 Variables

Variables Used

Economic Order Quantity - Economic order quantity is an equation for the inventory that determines the ideal order quantity a company should purchase for its inventory given a set cost of production, demand rate, and other variables.
Fixed cost per order - Fixed costs per order are the cost that does not change with an increase or decrease in the amount of goods or services produced or sold.
Demand in units per year - Demand in units per year represents the total demands of the unit per year.
Carrying cost per unit per year - Carrying cost per unit per year refers to the total cost of holding inventory for a unit per year.

STEP 1: Convert Input(s) to Base Unit

Fixed cost per order: 500 --> No Conversion Required
Demand in units per year: 2000 --> No Conversion Required
Carrying cost per unit per year: 3.5 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

EOQ = ((2*Cf*D)/C_h)*(1/2) --> ((2*500*2000)/3.5)*(1/2)

Evaluating ... ...

EOQ = 285714.285714286

STEP 3: Convert Result to Output's Unit

285714.285714286 --> No Conversion Required

FINAL ANSWER

285714.285714286 ≈ 285714.3 <-- Economic Order Quantity

(Calculation completed in 00.004 seconds)

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< 22 Business Calculators

Macaulay Duration

Go Macaulay Duration = sum(x,1,5,Cash Flow Number,((Cash Flow/(1+Yield to Maturity (YTM)/Compounding Periods))^Cash Flow Number))*(Time in Years/Present Value)

Weighted Average Cost of Capital

Go Weighted average cost of capital = ((Market value of the firm’s equity/Firm Value)*Cost of Equity)+(((Market Value of the Firm’s Debt/Firm Value)*Cost of Debt)*(1-Corporate Tax Rate))

Total Inventory Cost

Go Total Inventory Cost = Carrying cost per unit per year*(Quantity of Each Order/2)+Fixed cost per order*(Demand in units per year/Quantity of Each Order)

Acid Test Ratio

Go Acid Test Ratio = (Cash+Accounts Receivable+Short Term Investments)/Current Liabilities

Economic Order Quantity

Go Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2)

Return on Capital Employed

Go Return on capital employed = (Earnings Before Interest and Taxes/(Total Assets-Current Liabilities))*100

Diluted Earnings per Share

Go Diluted Earnings per Share = Net Income/(Average Shares+Other Convertible Securities)

Inventory Shrinkage

Go Inventory Shrinkage = ((Recorded Inventory-Actual Inventory)/Recorded Inventory)*100

Modified Duration

Go Modified Duration = Macaulay Duration/(1+Yield to Maturity (YTM)/Coupon Periods)

Target Inventory Investment

Go Target Inventory Investment = Projected Annual Cost of Goods Sold from Stock Sales/Target Inventory Turnover

Retention Ratio

Go Retention Ratio = (Net Income-Dividend)/Net Income

Contribution Margin per Unit

Go Contribution Margin per Unit = Sales Price per Unit-Variable Cost per Unit

Operating Expense Ratio

Go Operating Expense Ratio = (Operating Expense/Gross Operating Income)*100

Break-Even Point

Go Break Even Point = Fixed Costs/Contribution Margin per Unit

Estimated Earnings

Go Estimated Earnings = Forecasted Sales-Forecasted Expense

Debt Coverage Ratio

Go Debt Coverage Ratio = Net Operating Income/Debt Service

Dividends Per Share

Go Dividends Per Share = Total Dividends/Number of Shares

Solvency Ratio

Go Solvency Ratio = (Shareholders Fund*100)/Total Assets

Estimate at completion

Go Estimate at Completion = Actual Cost+Bottom up ETC

Percentage off

Go Percentage Off = 1-(Selling Price/Original Price)

Preferred Stock

Go Preferred Stock = Dividend/Discount Percentage

Days in Inventory

Go Days in Inventory = 365/Inventory Turnover

Economic Order Quantity Formula

Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2)
EOQ = ((2*Cf*D)/C_h)*(1/2)

How to Calculate Economic Order Quantity?

Economic Order Quantity calculator uses Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2) to calculate the Economic Order Quantity, Economic Order Quantity is an equation for the inventory that determines the ideal order quantity a company should purchase for its inventory given a set cost of production, demand rate, and other variables. Economic Order Quantity is denoted by EOQ symbol.

How to calculate Economic Order Quantity using this online calculator? To use this online calculator for Economic Order Quantity, enter Fixed cost per order (Cf), Demand in units per year (D) & Carrying cost per unit per year (C_h) and hit the calculate button. Here is how the Economic Order Quantity calculation can be explained with given input values -> 285714.3 = ((2*500*2000)/3.5)*(1/2).

FAQ

What is Economic Order Quantity?

Economic Order Quantity is an equation for the inventory that determines the ideal order quantity a company should purchase for its inventory given a set cost of production, demand rate, and other variables and is represented as EOQ = ((2*Cf*D)/C_h)*(1/2) or Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2). Fixed costs per order are the cost that does not change with an increase or decrease in the amount of goods or services produced or sold, Demand in units per year represents the total demands of the unit per year & Carrying cost per unit per year refers to the total cost of holding inventory for a unit per year.

How to calculate Economic Order Quantity?

Economic Order Quantity is an equation for the inventory that determines the ideal order quantity a company should purchase for its inventory given a set cost of production, demand rate, and other variables is calculated using Economic Order Quantity = ((2*Fixed cost per order*Demand in units per year)/Carrying cost per unit per year)*(1/2). To calculate Economic Order Quantity, you need Fixed cost per order (Cf), Demand in units per year (D) & Carrying cost per unit per year (C_h). With our tool, you need to enter the respective value for Fixed cost per order, Demand in units per year & Carrying cost per unit per year and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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