Question
Maria's Candle Company manufactures candles. The company buys wax in 45-Kilogram containers that cost $17 each. The company uses 25,000 containers per year, and usage
Maria's Candle Company manufactures candles. The company buys wax in 45-Kilogram containers that cost $17 each. The company uses 25,000 containers per year, and usage occurs evenly throughout the year. The average cost to carry a 45-Kilogram container in inventory per year is $3, and the cost to place an order is $9. The company works 250 days per year.
The economic order quantity (rounded) is
a. | 1,000 containers. |
b. | 750 containers. |
c. | 45 containers. |
d. | 387 containers. |
The lead time is 4 working days and the average rate of usage is 60 containers per day. What is the reorder point?
a. | 240 containers |
b. | 260 containers |
c. | 220 containers |
d. | 200 containers |
The lead time is 4 working days, the average rate of usage is 60 containers per day, and the company carries a safety stock of 25 containers. What is the reorder point?
a. | 285 containers |
b. | 245 containers |
c. | 265 containers |
d. | 225 containers
|
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