Supply Chain Management - PSFT (MOSC)

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Why cannot the Economic Order Quantity (EOQ) be calculated for Actual Cost Items?

edited May 18, 2015 3:40PM in Supply Chain Management - PSFT (MOSC) 1 commentAnswered ✓

In the PeopleBooks (see extract below) you can read that the Economic Order Quantity (EOQ) calculation is based on 'u', amongst other variables, and u = the Item's Standard or Average Cost, depending on the Item's Cost Method.

What about the Actual Cost Items? Why can't the EOQ be calculated for these Items?

PeopleSoft 8.x Inventory PeopleBook > Replenishing Inventory > Creating and Modifying Replenishment Requests > Defining Replenishment Parameters' y

EOQ (Economic Order Quantity): Select to calculate economic order quantities for your Business Unit. The 'Replenishment Parameters' process calculates the EOQ by using the industry standard calculation, as follows:

EOQ = SQRT ( (2 * d * c) / (i *

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