Communication to the Editor—A Note on Krone's Economic Lot-Size Formulas

When many products are to be manufactured on the same production facility we can avoid product interference, and thus obtain a feasible production schedule, by requiring all products to have the same cycle time T. In this way Krone, [Krone, L. H. Jr. 1964. A note on economic lot-sizes for multipurpose equipment. Management Sci.10 (3, April).], develops formulas for determining economic lot-sizes for multipurpose equipment. The author treats the case where backorders are permissible with a cost of backorder proportional to the length of time for which the backorder exists. The purpose of this note is to include a fixed cost of backorder into the formulas.