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Construction Cost Indices come in many types: Final cost by specific building type; Final cost composite of buildings but still all within one major building sector; Final cost but across several major building sectors (ex., residential and nonresidential buildings); Input prices to subcontractors; Producer prices and Select market basket indices. These costs must be capitalized and will add to the cost basis of your home, which reduces your gain on the sale of your home. When you sell your home, you can exclude $250,000 of the gain from taxation ($500,000 if filing a joint return). Therefore, the annual requirement is 300 units x 12 months = 3,600 units. In turn, the EOQ can be computed as follows: No. of Orders = 3,600 units / 900 units = 4 orders = 3,600 units / 196 units = 18 orders approx. Ordering Cost = 4 orders x $16 per order = $64 Also, in the case of EOQ: = 18 orders x $16 per order = $288 Average Inventory. 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