The Sunrise Company uses 150,000 gallons of acid per month. The cost of carrying the chemical in inventory is RM0.50 per gallon per year, and the cost of ordering the chemical is RM150 per order. The firm uses the chemical at a constant rate throughout the year. It takes 18 days to receive an order once it is placed. What is the inventory reorder point?

Select one:

A.

105,000 gallons

B.

7,500 gallons

C.

25,000 gallons

D.

90,000 gallons