Hotel Singapura uses plastic litter bags for housekeeping. The hotel places orders for these bags only when the inventory is below the reorder level. The hotel operates for 52 weeks a year, 7 days per week. The bags come in a pack of 12 and costs $10.75 each. The following information is available about these bags. Demand = 95 packs/week Order cost = $58/order Annual holding cost = 25% of cost Required service level = 90% Lead time = 4 weeks (28 working days) Standard deviation of weekly demand = 16 packs Records show that there are 315 packs available on-hand and no orders are pending from the supplier.

(b) Solve what should be the reorder point, ROL. An inventory withdrawal of 10 packs was just made. Discuss whether it is time to reorder or not.