Under a periodic review system, enough inventory must be carried to protect against stockout for the ___________.
A) replenishment lead time
B) review period
C) replenishment lead time plus the review period
D) bottleneck cycle time
E) bottleneck cycle time plus the replenishment lead time

Question

Quizplus · Accepted Answer

In a periodic review system, inventory is reviewed and replenished at fixed intervals, or the review period. Therefore, enough inventory must be carried to protect against stockout during the review period and the replenishment lead time (time to receive new inventory). The bottleneck cycle time is not relevant to determining inventory levels in a periodic review system.

Under a Periodic Review System, Enough Inventory Must Be Carried