Is there a way to set a limit of 120 files in a folder
and then replace the oldest file with the newest file
being copied once the quota has been reached? Thanks for
your input!

Ed wrote:

NT doesn't have any built-in quota managing and the only
third-party quota manager I've used only allowed you to
set quota's by size, not by file count.

You could write a batch file that will do the copying and
deleting for you. The trick then would be to remember
to only use that batch file for copying to that folder.
Probably easier to write a little Delphi or C/C++ app to
monitor the folder and run that app as a service.