Maximum Stock Out Manufacturing Model Calculator

✖Demand per Year is the number of goods that consumers are willing and able to purchase at various prices during a given year.ⓘ Demand per Year [D]			+10% -10%
✖Order Cost is the expenses incurred to create and process an order to a supplier.ⓘ Order Cost [C₀]			+10% -10%
✖The Shortage Cost is called the associate cost and is equal to the product's contribution margin.ⓘ Shortage Cost [C_s]			+10% -10%
✖Production Rate refers to the number of goods that can be produced during a given period of time.ⓘ Production Rate [K]			+10% -10%
✖Carrying Cost is the total of all expenses related to storing unsold goods, and refers to the total cost of holding inventory.ⓘ Carrying Cost [C_c]			+10% -10%

✖The Maximum Stock out Manufacturing Model is the maximum capacity of a business to stock goods.ⓘ Maximum Stock Out Manufacturing Model [Q₁]

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Maximum Stock Out Manufacturing Model Solution

STEP 0: Pre-Calculation Summary

Formula Used

Maximum Stock out Manufacturing Model = sqrt(2*Demand per Year*Order Cost*Shortage Cost*(1-Demand per Year/Production Rate)/(Carrying Cost*(Carrying Cost+Shortage Cost)))
Q₁ = sqrt(2*D*C₀*C_s*(1-D/K)/(C_c*(C_c+C_s)))
This formula uses 1 Functions, 6 Variables

Functions Used

sqrt - A square root function is a function that takes a non-negative number as an input and returns the square root of the given input number., sqrt(Number)

Variables Used

Maximum Stock out Manufacturing Model - The Maximum Stock out Manufacturing Model is the maximum capacity of a business to stock goods.
Demand per Year - Demand per Year is the number of goods that consumers are willing and able to purchase at various prices during a given year.
Order Cost - Order Cost is the expenses incurred to create and process an order to a supplier.
Shortage Cost - The Shortage Cost is called the associate cost and is equal to the product's contribution margin.
Production Rate - Production Rate refers to the number of goods that can be produced during a given period of time.
Carrying Cost - Carrying Cost is the total of all expenses related to storing unsold goods, and refers to the total cost of holding inventory.

STEP 1: Convert Input(s) to Base Unit

Demand per Year: 10000 --> No Conversion Required
Order Cost: 200 --> No Conversion Required
Shortage Cost: 25 --> No Conversion Required
Production Rate: 20000 --> No Conversion Required
Carrying Cost: 4 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

Q₁ = sqrt(2*D*C₀*C_s*(1-D/K)/(C_c*(C_c+C_s))) --> sqrt(2*10000*200*25*(1-10000/20000)/(4*(4+25)))

Evaluating ... ...

Q₁ = 656.532164298613

STEP 3: Convert Result to Output's Unit

656.532164298613 --> No Conversion Required

FINAL ANSWER

656.532164298613 ≈ 656.5322 <-- Maximum Stock out Manufacturing Model

(Calculation completed in 00.004 seconds)

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Credits

Created by Suman Ray Pramanik

Indian Institute of Technology (IIT), Kanpur

Suman Ray Pramanik has created this Calculator and 50+ more calculators!

Verified by Payal Priya

Birsa Institute of Technology (BIT), Sindri

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< Manufacturing and Purchase Model Calculators

EOQ Manufacturing Model with Shortage

LaTeX Go EOQ Manufacturing Model with Shortage = sqrt(2*Demand per Year*Order Cost*(Shortage Cost+Carrying Cost)/(Carrying Cost*Shortage Cost*(1-Demand per Year/Production Rate)))

Maximum Stock Out Manufacturing Model

LaTeX Go Maximum Stock out Manufacturing Model = sqrt(2*Demand per Year*Order Cost*Shortage Cost*(1-Demand per Year/Production Rate)/(Carrying Cost*(Carrying Cost+Shortage Cost)))

EOQ Manufacturing Model with No Shortage

LaTeX Go EOQ Manufacturing Model No Shortage = sqrt((2*Order Cost*Demand per Year)/(Carrying Cost*(1-Demand per Year/Production Rate)))

EOQ Purchase Model with No Shortage

LaTeX Go EOQ Purchase Model No Shortage = sqrt(2*Demand per Year*Order Cost/Carrying Cost)

Maximum Stock Out Manufacturing Model Formula

LaTeX Go

What is maximum stock out?

The maximum stock out is the maximum capacity of a business to stock goods. It may occur due to reasons like demand limitation of goods (in production or sales), the storage capacity of the business, rationed funds, etc. It is the difference between the economic order quantity to the maximum inventory.

How to Calculate Maximum Stock Out Manufacturing Model?

Maximum Stock Out Manufacturing Model calculator uses Maximum Stock out Manufacturing Model = sqrt(2*Demand per Year*Order Cost*Shortage Cost*(1-Demand per Year/Production Rate)/(Carrying Cost*(Carrying Cost+Shortage Cost))) to calculate the Maximum Stock out Manufacturing Model, The maximum stock out manufacturing model is the maximum capacity of a business to stock goods. It is the difference between the economic order quantity to the maximum inventory. Maximum Stock out Manufacturing Model is denoted by Q₁ symbol.

How to calculate Maximum Stock Out Manufacturing Model using this online calculator? To use this online calculator for Maximum Stock Out Manufacturing Model, enter Demand per Year (D), Order Cost (C₀), Shortage Cost (C_s), Production Rate (K) & Carrying Cost (C_c) and hit the calculate button. Here is how the Maximum Stock Out Manufacturing Model calculation can be explained with given input values -> 656.5322 = sqrt(2*10000*200*25*(1-10000/20000)/(4*(4+25))).

FAQ

What is Maximum Stock Out Manufacturing Model?

The maximum stock out manufacturing model is the maximum capacity of a business to stock goods. It is the difference between the economic order quantity to the maximum inventory and is represented as Q₁ = sqrt(2*D*C₀*C_s*(1-D/K)/(C_c*(C_c+C_s))) or Maximum Stock out Manufacturing Model = sqrt(2*Demand per Year*Order Cost*Shortage Cost*(1-Demand per Year/Production Rate)/(Carrying Cost*(Carrying Cost+Shortage Cost))). Demand per Year is the number of goods that consumers are willing and able to purchase at various prices during a given year, Order Cost is the expenses incurred to create and process an order to a supplier, The Shortage Cost is called the associate cost and is equal to the product's contribution margin, Production Rate refers to the number of goods that can be produced during a given period of time & Carrying Cost is the total of all expenses related to storing unsold goods, and refers to the total cost of holding inventory.

How to calculate Maximum Stock Out Manufacturing Model?

The maximum stock out manufacturing model is the maximum capacity of a business to stock goods. It is the difference between the economic order quantity to the maximum inventory is calculated using Maximum Stock out Manufacturing Model = sqrt(2*Demand per Year*Order Cost*Shortage Cost*(1-Demand per Year/Production Rate)/(Carrying Cost*(Carrying Cost+Shortage Cost))). To calculate Maximum Stock Out Manufacturing Model, you need Demand per Year (D), Order Cost (C₀), Shortage Cost (C_s), Production Rate (K) & Carrying Cost (C_c). With our tool, you need to enter the respective value for Demand per Year, Order Cost, Shortage Cost, Production Rate & Carrying Cost 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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