Chelsea Company has determined the following costs are associated with one of its products.$\begin{array}{ll}
\text { Lead time (weeks) } & 11 \
\text { Average weekly usage (units) } & 100 \
\text { Maximum weekly us age (units) } & 120
\end{array}$
-
The safety stock is

A)220 units.
B)206 units.
C)300 units.
D)150 units.

Question

Chelsea Company has determined the following costs are associated with one of its products.$\begin{array}{ll}
\text { Lead time (weeks) } & 11 \
\text { Average weekly usage (units) } & 100 \
\text { Maximum weekly us age (units) } & 120
\end{array}$
-
The safety stock is

A)220 units.
B)206 units.
C)300 units.
D)150 units.

Quizplus · Accepted Answer

Safety stock = (Maximum weekly usage - Average weekly usage) x Lead time= (120 - 100) x 11= 220 units

Chelsea Company Has Determined the Following Costs Are Associated with One