The optimal order and payment policies for deteriorating items in discount cash flows analysis under the alternatives of conditionally permissible delay in payments and cash discount

Top ◽  
2008 ◽  
Vol 18 (2) ◽  
pp. 429-443 ◽  
Author(s):  
Chih-Te Yang
Keyword(s):  
Cash Flows ◽  
Deteriorating Items ◽  
Optimal Order ◽  
Permissible Delay In Payments ◽  
Cash Discount ◽  
Delay In Payments ◽  
Payment Policies

scholarly journals An EPQ model under cash discount and permissible delay in payments derived without derivatives

2007 ◽  
Vol 17 (2) ◽  
pp. 177-193 ◽  
Author(s):  
Yung-Fu Huang ◽  
Chung-Li Chou ◽  
Jui-Jung Liao
Keyword(s):  
Cycle Time ◽  
Optimal Order ◽  
Selling Price ◽  
Order Quantity ◽  
Permissible Delay In Payments ◽  
Special Cases ◽  
Time Optimal ◽  
Optimal Order Quantity ◽  
Cash Discount ◽  
Delay In Payments

The main purpose of this paper is to investigate the case where the retailer?s unit selling price and the purchasing price per unit are not necessarily equal within the economic production quantity (EPQ) framework under cash discount and permissible delay in payments. We establish the retailer?s inventory system as a cost minimization problem to determine the retailer?s optimal inventory cycle time, optimal order quantity and optimal payment time. This paper provides an algebraic approach to determine the optimal cycle time, optimal order quantity and optimal payment time. This approach provides one theorem to efficiently determine the optimal solution. Some previously published results of other researchers are deduced as special cases. Finally, numerical examples are given to illustrate the result and the managerial insights are also obtained.

THE OPTIMAL CYCLE TIME FOR DETERIORATING ITEMS WITH LIMITED STORAGE CAPACITY UNDER PERMISSIBLE DELAY IN PAYMENTS

2006 ◽  
Vol 23 (03) ◽  
pp. 347-370 ◽  
Author(s):  
KUN-JEN CHUNG ◽  
TIEN-SHOU HUANG
Keyword(s):  
Cycle Time ◽  
Storage Capacity ◽  
Transportation Cost ◽  
Deteriorating Items ◽  
Inventory Models ◽  
Permissible Delay In Payments ◽  
Continuous Release ◽  
Deterioration Rate ◽  
Holding Cost ◽  
Delay In Payments

Inventory models with deteriorating items have received considerable attention in recent years. In considering the deteriorating inventory with permissible delay in payments, most researchers pay attention to a single warehouse. Under conditions of permissible delay in payments, this paper develops a model to determine the optimal cycle time for a single deteriorating item that is stored in two different warehouses. A rented warehouse (RW) is used to store the excess units over the fixed capacity W of the owned warehouse (OW). The rented warehouse is assumed to charge higher unit holding cost than the OW. In this paper, we propose a two-warehouse inventory model for deteriorating items under permissible delay in payments. It is assumed that the deterioration rate in RW is the same as in OW, and the holding cost in RW is greater than that in OW. The stocks of RW are transported to OW in continuous release pattern and the transportation cost is ignored. Three theorems are developed to determine the optimal cycle time and numerical examples are given to illustrate these theorems.

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