Figure 24-1
Mrs. Brown's Bagel Company manufactures specialty bagels. The company buys flour in 50-kg bags that cost £25 each. The company uses 10,000 bags per year, and usage occurs evenly throughout the year.
The average cost to carry a 50-kg bag in inventory per year is £4, and the cost to place an order is £10.
The company works 250 days per year.
Mrs. Brown's Bagel Company manufactures specialty bagels. The company buys flour in 50-kg bags that cost £25 each. The company uses 10,000 bags per year, and usage occurs evenly throughout the year.
The average cost to carry a 50-kg bag in inventory per year is £4, and the cost to place an order is £10.
The company works 250 days per year.
-Refer to Figure 24-1. If Brown's lead time is four working days, the average rate of usage is 40 bags per day, and the company carries a safety stock of 20 bags, the reorder point would be
A) 180 bags.
B) 140 bags.
C) 160 bags.
D) 100 bags.
Correct Answer:
Verified
Q8: The reorder point for inventory depends upon
Q9: Ordering frequently in small lot sizes minimizes
A)ordering
Q10: The reorder point for inventory is calculated
Q11: Which of the following is NOT considered
Q12: Economic order quantity refers to the order
Q14: JIT avoids shutdowns due to materials shortages
Q15: If inventory is purchased from an outside
Q16: JIT purchasing is done using
A)short-term contracts that
Q17: If inventory is produced internally, the inventory-related
Q18: Placing large, infrequent orders minimizes
A)ordering cost.
B)carrying cost.
C)stockout
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