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