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material cost formula Related: Economic Ordering Quantity & ABC Analy...
Maximum Level
Maximum Level = Re-order level + Re-order quantity – (Minimum consumption x Minimum
Re-order period)
2. Minimum Level
Minimum Level = Re-order level – (Average rate of consumption x Average time
required to obtain fresh delivery)       
 (or)
Minimum Level = Re-order level – (Normal consumption x Normal Re – order period)
3. Re-order level
Re-order level = Maximum consumption x Maximum re-order period
4. Average Stock Level                                                                                                                             
Average Stock Level = 1/2 (Maximum Level + Minimum level)  
       (or)                        
Minimum level + 1/2 of Re-order Quantity
5. Danger level
Danger level = Average consumption x maximum re-order period for emergency
 purchases.

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material cost formula Related: Economic Ordering Quantity & ABC Analysis - Material Cost, Cost Accounting?
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