How to Calculate Total Inventory Cost?
Total Inventory Cost calculator uses 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) to calculate the Total Inventory Cost, Total inventory cost is the total cost associated with ordering and carrying inventory, not including the actual cost of the inventory itself. Total Inventory Cost is denoted by TIC symbol.
How to calculate Total Inventory Cost using this online calculator? To use this online calculator for Total Inventory Cost, enter Carrying cost per unit per year (C_{h}), Quantity of Each Order (Q), Fixed cost per order (Cf) & Demand in Units Per Year (Demand) and hit the calculate button. Here is how the Total Inventory Cost calculation can be explained with given input values -> 20087.5 = 3.5*(50/2)+500*(2000/50).