Case 8-2
THE AZTEC COPY CENTER
EOQ Problem Set

The Aztec Copy Center is having trouble keeping paper in stock. Its estimates of demand, cost, and time are as follows:

 

		                    Year 1    Year 2
		Annual Demand (000)    840      1065
		Carrying Costs          8%       12%
		Order Costs         $10.27    $17.23
		Per Unit Costs       $4.60     $5.48
		Lead Time (in days)     10        10
		Days per Year          250       250

 

For each year find the:

Order Quantities

Reorder Inventory Levels

Order Costs

Holding Costs

Acquisition Costs

Order Related Costs

Total Product Related Costs

1. Solve this problem using the simple EOQ model and print out the results.

2. Using the second year data from above and the expected demand schedule provided below, use the discrete model to find the actual order costs, total costs, optimal order schedule, and mounts for this anticipated demand. Calculate order quantities and periods then print out the results. 

      Paper Demanded (000), by Month
 1  2  3  4   5   6   7   8  9 10 11 12
22 34 67 90 128 197 240 110 57 50 43 27