Vision Company sells optical equipment. Blitz Company manufactures special glass lenses. Vision orders 11,400 lenses per year, 220 per week, at $40 per lens. Blitz covers all shipping costs. Vision earns 22% on its cash investments. The purchase-order lead time is 3.0 weeks. Vision sells 315 lenses per week. The following data are available:

What is the reorder point?

Question

Vision Company sells optical equipment. Blitz Company manufactures special glass lenses. Vision orders 11,400 lenses per year, 220 per week, at $40 per lens. Blitz covers all shipping costs. Vision earns 22% on its cash investments. The purchase-order lead time is 3.0 weeks. Vision sells 315 lenses per week. The following data are available:

What is the reorder point?

Quizplus · Accepted Answer

Reorder point = 315 lenses × 3.0 weeks = 945.0 lenses

Vision Company Sells Optical Equipment